The recession, which the country faced between July-September, has finally shown signs of diminishing, and there has been a growth in the GDP for the 3rd quarter. However, the development is still stunted, and the economy is still suffering because there has been a rise in the number of cases once again.
The country’s economy is still 8.2% smaller than the last year before the virus hit the nation. A record number of 19.8% contracted the economy in the first three months after the lockdown began.
The six months of contraction or consecutive two times for three months of economic downfall are generally termed recession. Many countries worldwide went into recession after the initial wave of pandemic hit, and there was seen a surge in unemployment.
Similarly, the UK has faced a massive unemployment surge as it hit a surprising number of 4.8%. Over 243,000 people lost their jobs in the new wave of unemployment for the first three months, which is highest in a decade since March 2009.
More young people faced unemployment than any other strata. The Office of National Statistics says, “We’re seeing a continuation of a weakening of the labour market, fewer people on the payrolls and fewer people employed overall. That is now passing through to increasing unemployment altogether.”
However, over 2.5 million people are still employed under furlough, which is a good sign that they still have their jobs. Jonathan Athow, ONS Deputy National Statistician for Economic Statics, said, “We might see furlough creep up again and that might mean we don’t see any further big increases in redundancies or unemployment, but it’s way too early to tell what will happen,”
The economy has seen a growth in September of about 1.1% consecutively for the fifth month of expansion. The level of development, however, has seen a contraction when compared to the last few months.
Athow said on the situation, “The return of children to school boosted activity in the education sector. Housebuilding also continued to recover, while business strengthened for lawyers and accountants after a poor August. However, pubs and restaurants saw less business after the Eat Out to Help Out scheme ended and accommodation saw less business after a successful summer.”
The businesses in the country are also suffering from this recession. Welsh food packaging firm has seen the sales dropped by half in the first few months of the lockdown. The company took a venture of including the production of Personal Protective Equipment, among other things, and now the head of the company, Lorenzo Angelucci, says that they are better in performance than they were at the beginning of the fiscal year.
He does concede that the pandemic was a blow to the business everywhere, including his. However, his quick wit and creativity made them escape a worse outcome.
“Obviously the beginning of the pandemic was pretty tough,” he told a news agency. “It forced us to be creative and come up with other types of products.”
The takeaway services being open is also one of the plus points for businesses like Transcend Packaging, a Welsh food firm that provides companies like McDonald’s.
“Food packaging is by default safer in this situation, because people still need to eat,” said the boss. “But the economy itself, I don’t think will be in a very nice position for a long time.”
Chancellor Rishi Sunak told in an interview that the time ahead is tricky, but there is a light at the end of this tunnel. He said, “Our priority remains to protect as many jobs as possible, I am very confident that the measures we have put in place will do the job that we need them to do.”
Chief UK economist at Pantheon Macroeconomics, Samuel Tombs, said the final months might see a contraction of about 0.5% again. He also said, “On a monthly basis, it probably won’t recover to September’s level until the spring, when it should be possible for Covid-19 restrictions to be sustainably relaxed,”
I’m Ava Paul, an experienced news website author with a special focus on the entertainment section. Over the past five years, I have worked in various positions of media and communication at World Stock Market. My experience has given me extensive knowledge in writing, editing, researching and reporting on stories related to the entertainment industry.
