The economy is much more fragile than some seem to think

23 Oct 2009, by Brendan Barber Guest in Economics

This morning’s growth figures from the Office of National Statistics show a 4% GDP drop for the third quarter of 2009. This means we are now in the longest recession in modern economic history. Even the co-ordinated world-wide stimulus has not been able to halt the damage done by the financial crash.

Even if we had achieved a technical recovery today, it would not feel like a recovery to the thousands losing their jobs or afraid that they will join the dole queue in the months ahead when unemployment will continue rising. It takes more than a statistical read out and the return of big bank bonuses for a real recovery.

These worse than expected figures should head off the growing signs of complacency. The economy is still extremely fragile. Any halt in economic stimulus – or even worse, cuts in spending in a premature effort to close the deficit – could easily send us into another downwards spiral.

Politicians cannot now say that the recession is over, so we can go back to treating the unemployed as work-shy scroungers rather than victims of the financial crash. Fighting unemployment – particularly among the young – has to be national priority number one.