How are you feeling about the economy? If you are optimistic then I welcome your positivity. However, you are very much in the minority according to new research that found confidence in the British economy has fallen to its lowest ever level recorded.
That means levels of negativity are below those at the time of the global financial crash under Gordon Brown, Covid, the cost of living crisis following the pandemic and illegal invasion of Ukraine, and even the winter of discontent. Three quarters of people expect the economy to get worse over the next 12 months - only 7 per cent think it will improve.
This is perhaps not surprising when the International Monetary Fund has just cut its forecasts for growth in the UK, US, and globally.
So what are the reasons for our collective gloom? It is undoubtedly the case that Rachel Reeves’ October budget with the Jobs Tax, higher borrowing, and higher taxes hit business confidence. Companies paused investments and stopped plans to take on more staff. Indeed, unemployment has risen since. Equally, the trade uncertainty caused by President Trump’s tariffs has knocked confidence and understandably people are worried about what it could mean for jobs and wages here.
There is the very real danger of an economic doom loop here - if people fear for the future then businesses will not invest and consumers will not spend.
The downgrade of growth and this seemingly pervasive negativity towards the economy should be a wake up call for the Chancellor. She needs to realise that her and the Prime Minister’s choices since the election were wrong. Putting up taxes, driving away investors and wealth creators, and hitting hairdressers, shops, care homes, hospices, pubs, restaurants, small businesses and others with higher taxes is doing real damage.
For a government that came to power having the fastest growing economy in the G7 as its overriding mission, this is a very damaging position. People are feeling the impact of higher energy, water, council tax and other bills. With inflation expected to increase again, the pressure on family budgets is only growing.
At a time when Labour should be doing all it can to support growth, ministers are taking the wrong approach and impact of a higher tax, spending, and borrowing agenda is plain to see.
But all is not lost. It is time to correct course - support businesses, cut regulation, take action to bring energy prices down for consumers and businesses, boost food security by scrapping the family farm tax and stop prime agricultural land being used for solar, and above all believe in the people who take risks and create jobs. Be positive, set out a vision and a plan to deliver it.
Speaking of positivity I have just enjoyed being part of the crowds cheering on runners in the London Marathon. Although I didn’t run this year, I was pleased to support friends and people taking part in this great event which has raised over £1 billion for charity since it began 45 years ago. There were record numbers taking part despite the heat.
While I’m thinking about running again next year, I am looking forward to taking part in the GEAR 10k again this weekend which is always a great event to showcase Lynn.
