After recording the continuing economic contraction for the second quarter of this year by 20.4 percent, Britain is entering a state of economic recession, the worst since these quarterly numbers began to be recorded in 1955. Because of the closure resulting from the outbreak of the Corona virus and the cessation of economic movement, many Britons lost their jobs It is also expected that these numbers will increase in the coming months, according to the Minister of Finance. With these numbers announced, the UK will be recording the worst economic performance in the second quarter in Europe.
The United Kingdom, which was struck by the Covid-19 pandemic in the second quarter of this year, recorded a “record” contraction in Its economy By 20.4 percent, to formally face its worst recession since recording these quarterly numbers began in 1955. And any country enters into a recession after recording a contraction in its gross domestic product for two consecutive quarters.
The Office for National Statistics, which published these figures on Wednesday, indicated that this is the first technical recession in Britain since 2009 and the financial crisis. The National Statistics Office, which published these figures on Wednesday, said that the bulk of this contraction, which began to have effects in March, was recorded in April, when the country was almost completely closed, which led to a 20 percent decline in production.
With these numbers announced, the UK recorded its worst economic performance in the second quarter in EuropeIt was ahead of Spain (-18.5%) and much worse than France (-13.8%).
However, after the return of economic activity with the easing of isolation measures, GDP rose in May by 2.4 percent, followed by an acceleration in June (+8.7 percent) thanks to the reopening of all sectors, according to the office.
“The unemployment rate will continue to rise”
For his part, Finance Minister Rishi Sunak, commenting on those numbers, reaffirmed what he said previously that “difficult times await us, and today’s figures confirm this. Hundreds of thousands of people have lost their jobs, and unfortunately, in the coming months, more people will lose their jobs.”
The Office for National Statistics said that during two quarters of the recession, the British economy recorded a contraction of 22.1 percent, “slightly less than the 22.7 percent recorded in Spain, but more than twice the decline in GDP, which amounted to 10.6 percent.” In the United States “during the same period.
“The Kingdom’s performance is unusually worse than its peers.”
Analysts at the research institute Pantheon Macro noted that “the UK has performed extraordinarily worse than its peers”.
This poor performance can be attributed to the country, which also recorded the largest number of deaths in India Europe Because of the new Corona virus, to its severe dependence on services, especially consumer spending, which decreased during the closure period, “and the level of activity of parents, many of whom had to leave work to take care of their children,” as the analysts added.
According to this research firm, these factors should continue to slow the recovery in the third and fourth quarters.
The shock of the epidemic and the forced halt of activity were hardly mitigated by unprecedented measures and tens of billions of money injected by the government through loans or aid to maintain jobs, or by the Bank of England, which repurchased assets and granted an interest rate at its lowest historical level.
The recession has caused enormous social damage, as the number of people working between March and July decreased by 730,000, according to official figures released Monday.
Hardly a day goes by without announcing the abolition of thousands of jobs at companies wary of stopping a government underemployment program that subsidizes wages for employees at the end of October.
Unemployment is expected to rise, as is vulnerable employment and millions of Britons depend on minimal social assistance.
For the whole of 2020, the Bank of England expects a 9.5 percent decline in gross domestic product, but it expects a slower recovery in 2021 and that the economy will not return to the state it was in before the pandemic until 2022.
France 24 / AFP