Since the great recession, businesses in the UK have been able to utilise technology and social networking to reduce marketing costs. The same principle can also be applied to alternative areas of business, from logistics and operations to the way in which products are sold.
This is particularly true in the case of SME’s, where service providers such as TNT have constantly innovated to create low-cost and efficient solutions. It is this climate of innovation and growth that initially helped the UK to recover from the last recession, although the economy has struggled to return to the peaks achieved prior to 2007.
Which data-sets are pointing to the onset of a recession?
This sluggish recovery is more prevalent in some industries than others, and the most recent data-sets seem to suggest that the UK is bracing itself for another widespread recession.
The nation’s industrial sector is already back in recession, for example, and this represents the third time in eight years such a scenario has unfolded. The Industrial Production Report has revealed that output shrank by 0.4% during the first quarter, marking the second quarterly contraction in a row. This decline, which first set in during the autumn of 2015, also confirms that the industry has suffered its largest annual fall in nearly three years.
Total output in March was 1.9% lower than the previous year, underlining the onset of a recession and the challenges facing businesses in the months ahead.
Beyond the world of manufacturing, concerns are also growing about a marked slowdown in the economy as a whole. The Lloyds Bank purchasing managers’ index fell to 52.1 at the beginning of April, for example, which also represents the lowest point since 2013. A Labour Force Survey has also revealed that the number of jobs created in the UK has not increased since December, as business sentiment continues to fall nationwide.
The storm clouds ahead: Is Britain heading for another recession?
Let’s face facts; these figures are concerning and certainly suggest that the UK is in the grip of an economic decline.
With many data-sets also plummeting to their lowest points since 2013 (which was the year when the the British economy first began to emerge from the shadows of the great recession) there is no surprise that businesses are bracing themselves for a period of austerity later in 2016.
There are statistics that offer optimism, however, including a relatively low rate of unemployment and an improved economic output of 7.3% (in comparison with the previous peak value reported before the last recession in 2008). These figures hint at a solid foundation and an overall basis of economic strength, which may ultimately prevent the UK from falling into the grips of a fully-blown recession.
This has yet to be seen, but there is no doubt that the British economy is set to experience considerable turbulence in 2016.
One thing is for sure; there is no way to accurately predict precisely what will happen in the months or years to come!