The United Kingdom is on the verge of experiencing a recession over the foreseeable future, with the economy shrinking by 0.1% in between the months April to June.
A recession is a temporary economic decline for two consecutive three-month periods due to reduced industrials and trade activity.
The Bank of England has predicted the recession is on the horizon, these are partly due to covid schemes like track and tracing, retail sales plummeting and encountering the worst rate of price rises or inflation rate. Energy costs are also soaring as we speak which adds even more pressure onto the frail economy.
Business owners are facing a problematic situation especially after the pandemic. The main priority as of now is to survive and thrive in this chaotic environment. Kingdom Thenga, owner of multiple local bars and restaurants says ‘it’s not about making money, it’s not about trying to expand or trying to grow the business, but about trying to stabilise the business especially after the pandemic’
However, there are areas that have shown strong signs of growth such as tourism, entertainment and bars. In addition, people were celebrating the Platinum Jubilee, leading to a slight upsurge of growth in hotels, bars, hairdressers, outdoor events across the quarter.
Andy Verity, Economics correspondent explains ‘Due to the Platinum Jubilee, there were two less working days in June compared to May, which had an additional working day, which made a significant contribution to the decline in the GDP’
With activity within the consumer-facing services falling by 4.9% compared to before the pandemic. Overall, the recession that the Bank of England had predicted has not yet materialised more of a precursor.
