The British Economy looks like it could have already slipped back into Recession according to the think tank the Item Club. They claimed today that Gross Domestic Product shank in the last three months of 2011, and will fall further in the first three months of 2012.
Peter Spencer, their chief economic advisor told the BBC “Consumption was very badly hit by rising inflation last year, business spending has been paralysed, and of course recruitment has also gone on hold as a result of the euro crisis.
“And unfortunately, turning to exports, Europe takes the lion’s share of our exports.”
The past few week has seen devastating news on the High Street, with Tesco announcing that the Christmas period had been disappointing, resulting in billions of pounds being wiped of the value of the company. The Christmas period also brought bad news for Argos, Halfords and the chocolate manufacturer Thorntons as consumers tightened their belt and scaled back on spending.
Further bad news has been announced today with the news that Past Times has entered administration and fears that the Peacock group is about to enter administration with 11,000 jobs now at risk.
This would be the largest firm on the high street to enter administration since the Woolworth’s was forced to close its doors.
The growing problem is the Euro zone is also causing problems for Britain as exports to the Euro zone fall, and may force British Manufacturers to seek new markets for their goods.
As a result, many companies are holding off recruitment plans, with many failing to recruit while the down turn continues.
The office of National Statistics is due to publish it’s results next week, and it is expected that the figures would not throw out any good news.