With news that Germany’s economy is expected to have contracted 5% in 2009, and the UK’s 4.8%, it looks like after all the hay the Tories have been making about us still being in recession while Germany wasn’t, that our recession has actually been less severe than Germany’s.
Of course 0.2% is neither here nor there in the grand scheme of things, but then going on that basis you could knock about six months off the length of the UK recession, as we entered it on a 0.1% contraction and our 2009 Q3 figures has been revised upwards to a 0.2% contraction.
On top of this our unemployment levels remain better than average in the EU, though the link I’m providing only goes to Nov 09 for the EU and Sept 09 for the UK, since then our unemployment figures have performed better than expected, which is perhaps a better indicator for the real impact of the recession and a countries position to emerge strongly from it.
In terms of the people on the street, and those affected by the recession, this news is quite irrelevant to them, certainly to those families struggling with job losses.
But in terms of the political narrative it shows that once again the Tories have been wrong, and that the Government action to mitigate the effects and limit the depth and length of the recession has once again been proved correct.
With the head of the IMF today warning of a double-dip recession if the stimulus is ended too early we need to figure out a simple way to link these things in the publics mind. The IMF of course did not name the UK Conservative party as an example of a party that wants to end the stimulus immediately (and opposed it in the first place) but it is the course the Tories want to take, and we have more and more economists warning us of this danger – that the Tories represent – that would lead us into a double-dip recession and set the country back years and leave us with more debt, deficit and unemployment than we have now and all the social ills that go with it.
UPDATE: Well I may have to eat a little humble pie really – I think the figures used were only for 2009, when of course the recession began in 2008. It looks like the economy of the UK shrunk 6% overall! Not sure what Germany’s was though, could be worse!