The difficult slog ahead

With about 5,000 people being laid off every day, it sounds strange to talk of an economic recovery – as Stephen Timms did at the World at One. But he’s right. I reckon that, even now, the recession is over and that the economy will be shown to have grown in Q3 – ie, July, Aug and Sep. This is, of course, just the end of the beginning. We will have started the long crawl to recovery – and it will be about five years before the British economy gets back to where it was before the downturn. So it is a rash politician who will say “all clear, recession over” – unemployment will keep rising until about the middle of next year and then may take a very long time to recover. We are used to relatively quick economic recoveries – as per the early 1980s and 1990s. But inflation-induced recessions are far easier to fix.