Would you like to receive notifications on latest updates of the following headlines?

Uk Recessions: From The Early 1980S To Present Day

POSTED ON February 16, 2024 •   Uncategorized      BY Samuel O . Adeniyi

The UK economy has experienced several recessions throughout its history, each with its own unique causes and consequences.

This article will explore the major recessions that have occurred since the early 1980s, highlighting the key factors that triggered them and their lasting impacts.

1. Early 1980s Recession:

Causes:

  • Oil Crisis: The 1979 oil crisis, triggered by the Iranian Revolution, caused a sharp rise in oil prices, impacting global economies heavily.
  • Tight Monetary Policy: The Thatcher government implemented strict monetarist policies to combat inflation, leading to high interest rates and reduced money supply, further dampening economic activity.
  • Industrial Decline: The UK's manufacturing sector, which had already been facing challenges, was hit hard by the recession, leading to job losses and widespread hardship.

Impact:

  • GDP Decline: The UK economy contracted by a significant 4.2% between 1980 and 1982.
  • Unemployment: Unemployment rose sharply, reaching over 12% at its peak in 1984.
  • Social Unrest: The recession led to social unrest and industrial disputes, particularly in areas reliant on heavy industries.

2. Early 1990s Recession:

Causes:

  • Property Market Crash: The UK housing market experienced a bubble in the late 1980s, which burst in the early 1990s, leading to significant losses for banks and homeowners.
  • High-Interest Rates: The Bank of England raised interest rates to curb inflation, further impacting consumer spending and business investment.
  • Global Economic Downturn: The recession coincided with a global economic slowdown, exacerbating its effects on the UK.

Impact:

  • GDP Decline: The UK economy contracted by 2.2% between 1990 and 1991.
  • Unemployment: Unemployment rose to almost 10% at its peak in 1993.
  • Negative Equity: Many homeowners were left with negative equity, where their mortgage debt exceeded the value of their property.

3. Great Recession (2008-2009):

Causes:

  • Financial Crisis: The global financial crisis, triggered by the collapse of the US housing market and subsequent subprime mortgage crisis, impacted economies worldwide.
  • Credit Contraction: Banks became reluctant to lend, leading to a significant tightening of credit conditions, hindering business investment and consumer spending.
  • Loss of Confidence: Consumer and business confidence plunged, further dampening economic activity.

Impact:

  • GDP Decline: The UK economy experienced its worst recession since the Second World War, with GDP contracting by a staggering 9.8% in 2009.
  • Unemployment: Unemployment rose to over 8% at its peak in 2012.
  • Government Debt: The government incurred significant debt to support the economy during the recession, leading to austerity measures in the following years.

4. COVID-19 Recession (2020-2021):

Causes:

  • COVID-19 Pandemic: The global pandemic forced governments to implement lockdowns and restrictions to contain the spread of the virus, leading to widespread business closures and economic disruption.
  • Supply Chain Disruptions: The pandemic caused disruptions to global supply chains, impacting the availability and price of goods.
  • Reduced Consumer Spending: Consumer spending declined significantly due to job losses and reduced confidence.

Impact:

  • GDP Decline: The UK economy contracted by 2.5% in 2020, marking its first recession since the financial crisis.
  • Unemployment: Unemployment rose to 6.5% at its peak in 2021.
  • Increased Public Debt: Government borrowing increased further to support the economy during the pandemic.

5. Recession in 2024:

Possible Causes:

  • High Inflation: Inflation in the UK has reached its highest level in decades, driven by factors like rising energy prices and supply chain disruptions.
  • Rising Interest Rates: The Bank of England is raising interest rates to combat inflation, which could dampen economic activity.
  • Global Economic Slowdown: The global economy is facing headwinds due to the war in Ukraine and other factors, which could spill over to the UK.

Uncertainty:

It is important to note that a recession in 2024 is not yet guaranteed. However, the factors mentioned above raise concerns about the possibility of an economic downturn.

0
READ ALSO
Eno enhances healthcare with N200m contribution to UUTH
BY Abiodun Saheed Omodara February 16, 2025 0

In an effort to enhance healthcare services, the Governor of Akwa Ibom State, Pastor Umo Eno, has co...

READ ALSO
Ododo Reorganizes the Tourism Board, Kogi Hotels
BY Ebiakuboere England December 3, 2024 0

KOGI- Kogi State Governor Alhaji Ahmed Ododo has appointed former Kogi Hotels and Tourism Board Chai...

READ ALSO
Rivers Varsity Suspends Four Students For Assault
BY Benedicta Bassey June 16, 2024 0

The Rivers State University, Nkpolu-Oroworukwo, Port Harcourt has suspended four of its students con...

READ ALSO
French Embassy Unveils Waste Management Project Worth €753,000 in Varsities
BY Benedicta Bassey June 14, 2024 0

The French Embassy, via the Cooperation and Cultural Department, has launched a plastic waste manage...

READ ALSO
ATBU Enhances Research Capacity For Lecturers
BY Benedicta Bassey June 14, 2024 0

The management of the Abubakar Tafawa Balewa University, Bauchi, has enhanced research capabilities...

READ ALSO
Russia Dismisses Claim of Recruiting Nigerian Students For Ukranian War
BY Benedicta Bassey June 13, 2024 0

The Russian Embassy in Nigeria has debunked the claims of recruiting African students, particularly...

READ ALSO
Soludo Warns Tinubu Against Accepting Unsustainable Minimum Wage
BY Benedicta Bassey June 13, 2024 0

Anambra State Governor Charles Soludo on Thursday warned President Bola Tinubu against approving &ld...

READ ALSO
Obi Cubana Lauds Burna Boy For Settling Patients' Hospital Bills
BY Ebiakuboere England June 12, 2024 0

Award-winning Nigerian music star Damini Ogulu, also known as Burna Boy, has been praised by million...

OUR CHANNELS:

Nigerian States Accumulate N417.7 Billion in Domestic Debt Amid Rising FAAC Revenue
BY Abiodun Saheed Omodara July 8, 2025 0

At least 10 Nigerian states have cumulatively increased their domestic debt by N417.7 billion from t...


Governor Otti Facilitates Release of Inmates After 26 Years
BY Abiodun Saheed Omodara July 8, 2025 0

Governor Alex Otti of Abia State on Saturday welcomed three Nigerians who were released after spendi...


Tinubu Pledges to Eliminate Bureaucratic Hurdles in Agriculture During Bilateral Talks with Brazil
BY Abiodun Saheed Omodara July 8, 2025 0

President Bola Tinubu expressed his commitment on Saturday to his Brazilian counterpart, Luiz Inacio...


Sowore Condemns Tenure Extensions of Senior Security Officials for Violating 35-Year Service Limit
BY Abiodun Saheed Omodara July 7, 2025 0

Human rights advocate and ex-presidential aspirant, Omoyele Sowore, has criticized the ongoing tenur...


Eight Dead, Eight Injured as Commercial Bus Crashes into Truck
BY Abiodun Saheed Omodara July 8, 2025 0

Just 48 hours after a road accident in Ogun State resulted in the deaths of 10 individuals, another...


Nigerian Investors Launch $5 Billion Cooperative Trust Fund to Empower MSMEs
BY Abiodun Saheed Omodara July 8, 2025 0

A coalition of Nigerian investors has introduced a Cooperative Trust Fund valued at $5 billion, aime...


Nnamdi Kanu's Release Not a Condition for South-East Support of Tinubu- Umahi
BY Abiodun Saheed Omodara July 8, 2025 0

In light of calls for the release of the detained Nnamdi Kanu, leader of the banned Indigenous Peopl...


Real Madrid Edges Borussia Dortmund 3–2 in Thrilling FIFA Club World Cup Clash
BY Abiodun Saheed Omodara July 6, 2025 0

Real Madrid emerged victorious from a heart-stopping 3–2 thriller against Borussia Dortmund in...


NCDC Reports 781 Confirmed Lassa Fever Cases in Nigeria
BY Abiodun Saheed Omodara July 8, 2025 0

Nigeria has reported 145 fatalities attributed to Lassa fever, which corresponds to a case fatality...


Flood: 27 Lives Lost, Hundreds Displaced Amid Ongoing Rescue Efforts in Kerr County
BY Abiodun Saheed Omodara July 6, 2025 0

At least 27 people have been confirmed dead, with many more displaced due to flash flooding in Kerr...


More Articles

Load more...

Menu