The UK economy returns to recession in the first three
months of 2012 after shrinking by
0.2%
With a sharp fall in construction to blame for
the contraction in the economy, the Office for National Statistics
has said we have entered a double dip recession. The economy shrunk
by 0.3% in the final quarter of 2011 and 0.2% in the first quarter
of 2012.
BBC economics editor Stephanie Flanders says
it "adds to the picture that the economy is bumping along the
bottom". The figure is an early estimate and will have further
revisions in the coming months with David Cameron saying the
figures were “very, very disappointing”.
He commented "I don't seek to excuse them, I
don't seek to try to explain them away," he said at Prime
Minister's Questions. "There is no complacency at all in this
government in dealing with what is a very tough situation, which
frankly has just got tougher."
The huge cuts in public spending (25%) in
public sector housing and 24% in public non-housing with further
cuts expected in 2013 there is a big hole to fill. UK unemployment
fell in the months from December to February from 8.4% to 8.3%,
around 35,000.
Mike Fetters of TotalJobs, however, find the
figures by the ONS deceiving. He highlighted that "Whilst on the
surface they look rosier than those of the past few months, they
hide a number of concerns - not least the staggeringly high levels
of underemployment - and they don't take into account news from the
last couple of months."
With the class of 2012 set to graduate in the
summer, the contraction in the economy may mean many graduate
employers start to freeze their recruitment plans in preparation for the double
dip recession. Graduates will have to apply earlier to graduate jobs in a bid to
secure a job upon leaving university. Yet the worry is that many
new graduates will add to the others that are already unemployed or
underemployed.
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