The economic slump as a result of the Corona-lock downs is in the UK, lower than in any other European economy. The Minus of about 20 percent in the second quarter, surpassing the slump in Spain and in Italy, the virus crisis also heavily affected countries. One reason for this is that the British economy is so much dependent on service industries, which were in Lockdown almost to a standstill. The catering, retail and other service industries were forced to close by the end of March, to a large extent. London, the largest metropolis in Western Europe, with around nine million inhabitants and contributes almost a fifth of the economic output of the country, was a Ghost town.
The British have reduced their consumption to a Minimum. At the same time, the state has paid for more than nine million forced workers in training, so more than a quarter of the private employment, a relatively generous wage of four-fifths of their income. Mass redundancies have been there avoided, the Jobs remain for the time being (at least on paper). The company had to pay three months of nothing, now small social security contributions will be due.
The question is: How long will the Rezessionstal take? And: Can bridge the state of the break-in? In June, the British economy has recovered somewhat from the absolute Corona low point. Pent-up demand came back, the people have gone in shops, offices have reluctantly re-opened. In the third quarter, the economy is likely to continue to travel, albeit more slowly.
budget deficit of 320 billion pounds expected
Still, the economy is like with the handbrake, it is still difficult Corona-precautions the normal business of life. In the catering and retail tens of thousands of companies are struggling – both small and large – for their Survival. If the demand in the third and fourth quarter of this year comes quickly, and the new rules do not allow for reasonably smooth operation, many will have to close. The Central Bank speaks of a doubling of the unemployment rate from almost 4 percent to 7.5 percent by the end of the year.
