The U.K.’s Office for National Statistics announced on 12 August that its economy is facing its deepest recession since records began.
The Coronavirus pandemic caused the world economy to take a major hit, with many countries still struggling to provide financial relief to businesses, individuals and their families. Economic stimulus packages have aimed to be quick and substantial boosts, but the road to recovery is likely to be long for many. The Office for National Statistics in the United Kingdom, for instance, announced on 12 August that its economy is facing its deepest recession since records began.
What is the status of the U.K.’s economy?
The Office for National Statistics (ONS) reported that the U.K.’s gross domestic product (GDP) fell in the second quarter by 20.4%. When compared with the previous quarter drop of 2.2%, this is the country’s biggest quarterly decline since records began in 1955. The ONS also reported that this downturn is the most significant of any country in the Group of 7 (Canada, France, Germany, Italy, Japan, the U.S. and the U.K.). The figures do not count those who are furloughed, those on zero-hours contracts but not getting shifts, or those on temporary unpaid leave from a job. Prime Minister Boris Johnson was quoted as saying that the U.K. will have a “long, long way to go.”
What have been the U.K.’s efforts to boost its economy?
Like many other countries, the U.K. has released stimulus plans aimed at boosting the economy in the wake of COVID-19. In July, the ‘Plan for Jobs’ was created, totaling £30 billion including £5.6 billion in infrastructure spending. To tackle unemployment, the government created a “kickstart scheme” which subsidizes companies who create new jobs for people aged between 16 and 24 who have claimed Universal Credit and are deemed to be at risk of long-term unemployment. It also provided £1.6 billion in funding for career advising and job search support jobs. While the Coronavirus Job Retention Scheme will end on 31 October 2020, the chancellor unveiled a £1,000 bonus for businesses that retain furloughed employees until the end of January 2021.