The UK is dying a slow death.
They will have massive issues - just wait until the PIIGS story unravels.
http://www.bloomberg.com/news/2011-06-09/britain-winces-as-cameron-government-wields-austerity-ax-to-reduce-deficit.html
The government envisions about 80 billion pounds ($131 billion) of spending cuts plus 30 billion pounds of tax increases over the next four years. Last year, when the cuts began, was the easiest to bear. Some 6 billion pounds in efficiencies were realized by the government in its various departments.
A two-year pay freeze for public-sector employees started in April, and cuts on welfare spending, including a three-year freeze in child benefit payments, are under way. A total of 310,000 government-funded jobs are to be wiped out by 2015; about 20,000 of those will be gone by the end of this year.
There are already 2.5 million Britons out of work. As of March, the unemployment rate had held above 7.6 percent for 22 months. The possibility of a worsening job market is weighing on consumers, who are already seeing their incomes squeezed by rising prices for everything from food to car insurance.
“Income isn’t keeping pace with inflation, which is making people nervous,” said Nick Moon, managing director of GfK NOP, which conducts consumer confidence surveys. “People aren’t going to be rushing out to spend.”
“Consumer-spending growth is going to be sluggish at best,” said John Bason, finance director of London-based Associated British Foods, which owns the Primark chain of discount clothing stores. “If the authorities were to start tightening interest rates, that has to be negative for the U.K. consumer.”
“Confidence is quite easy to lose but hard to get back,”GfK’s Moon said. For now, “people see themselves getting poorer.”
They will have massive issues - just wait until the PIIGS story unravels.
http://www.bloomberg.com/news/2011-06-09/britain-winces-as-cameron-government-wields-austerity-ax-to-reduce-deficit.html
The government envisions about 80 billion pounds ($131 billion) of spending cuts plus 30 billion pounds of tax increases over the next four years. Last year, when the cuts began, was the easiest to bear. Some 6 billion pounds in efficiencies were realized by the government in its various departments.
A two-year pay freeze for public-sector employees started in April, and cuts on welfare spending, including a three-year freeze in child benefit payments, are under way. A total of 310,000 government-funded jobs are to be wiped out by 2015; about 20,000 of those will be gone by the end of this year.
There are already 2.5 million Britons out of work. As of March, the unemployment rate had held above 7.6 percent for 22 months. The possibility of a worsening job market is weighing on consumers, who are already seeing their incomes squeezed by rising prices for everything from food to car insurance.
“Income isn’t keeping pace with inflation, which is making people nervous,” said Nick Moon, managing director of GfK NOP, which conducts consumer confidence surveys. “People aren’t going to be rushing out to spend.”
“Consumer-spending growth is going to be sluggish at best,” said John Bason, finance director of London-based Associated British Foods, which owns the Primark chain of discount clothing stores. “If the authorities were to start tightening interest rates, that has to be negative for the U.K. consumer.”
“Confidence is quite easy to lose but hard to get back,”GfK’s Moon said. For now, “people see themselves getting poorer.”
No comments:
Post a Comment