At last some better news for the economy – the UK economy has come out of recession, after figures showed it had grown by a weaker-than-expected 0.1% in the last three months of 2009.
The economy had previously contracted for six consecutive quarters – the longest period since quarterly figures were first recorded in 1955. Whilst there have been some recent recovery signs such as last week’s UK unemployment figures falling for the first time in 18 months, we still have some tough times ahead.
Given the fact that the UK is the last major economy to come out of recession with Europe’s two biggest economies, Germany and France, coming out of recession last summer, I wonder if this government understands fully what it is doing.
The facts are the UK economy went into recession in the April-to-June quarter of 2008. During 18 months of recession, public borrowing increased to an estimated £178bn, and output has slumped by 6%.
I believe the BIG question we need to be asking right now is how we are going to manage to re-pay this debt unless we start to make some pretty big in-roads into public spending. As a business coach, I have been advising companies since well before the recession fully took a hold to look at stripping out costs whilst protecting levels of service. I am really concerned for those businesses that have reacted too slowly – burying your head in the sand isn’t going to work this time! Business owners, public sector directors and politicians need to be proactive and face up to the need to cut budgets now or it will be too late.
Do you agree with me or am I just being alarmist? My challenge is to get decision-makers to join the debate and to take the tough decisions. Now is the time for clear leadership, but do we have the leaders we need?