The UK economy faces a "rough" time in the near future because nations around the world are prioritising debt reduction, an economics writer…
The UK economy faces a "rough" time in the near future because nations around the world are prioritising debt reduction, an economics writer has argued.
Author of the Blindfolded Masochist Michael Baxter said the UK austerity programme would not necessarily be a drag on growth if it was only Britain doing it.
However, he noted: "At the moment it just seems to be a worldwide trend. I think the inevitable consequences of that is it is going to be a difficult period ahead, not just for the UK but for much of the world."
Such a situation could mean more harm to businesses and jobs, with people needing extra help as they find themselves less able to pay back what they owe.
Debt management plans may assist in this instance, by enabling those in trouble to find a way out.
Mr Baxter said a new recession may be possible in the UK, although the level of output is "already very low" and therefore it could be difficult for it to fall further.
As a result, a decline in gross domestic product would be "worrying indeed".
Indications that the economic problems currently faced by the UK are having a major impact on personal finances include the latest unemployment figures, which showed the number out of work has climbed past 2.5 million.
This was caused by a rise of 80,000 in the three months to July, with the number claiming jobseeker's allowance increasing to 1.58 million, the highest figure since the 1.61 million tally of January 2010.
By James Francis