The Conservatives have presided over the worst two periods for economic growth since the 1920s, according to new analysis published by the Trades Union Congress (TUC) on Tuesday 21 November.
Tories presiding over the worst economic growth in 100 years
The analysis of official statistics compares how the UK economy has recovered from financial crises over the last 100 years.
It shows how the Tories’ response to the bankers’ crash and the Covid pandemic has resulted in the lowest growth in a century.
The TUC says the austerity measures introduced by the government in 2010 resulted in annual growth rising by just 1.2%, on average, between the start of the global financial crisis and 2019.
This is the second worst performance for economic growth since the 1920s.
And since the 2020 pandemic UK annual growth has risen by just 0.8% – the worst since the 1920s.
The TUC says both growth rates are well below the long-term national average (2.3%) for economic growth before the bankers’ crash.
Dire consequences for working people
The analysis also shows how the Conservatives’ failure to deliver economic growth after the financial crisis and pandemic has had dire consequences for working people’s living standards.
Between 2007 and 2019 real wage growth fell by 0.2%. And from the pandemic real wages have risen by just 0.3%.
The TUC says this is the worst performance for real wages since Napoleonic times and is a historical outlier.
Higher national debt
The TUC says far from “fixing the roof” the Conservatives’ failure to deliver on growth has pushed up government debt.
Debt as a proportion of GDP grew, on average, by 4% a year between 2007 and 2019 and by over 3% a year between 2019 and 2023.
This is largest increase in government debt in more than a century. Even in the aftermath of the First World War, debt as proportion of GDP only grew by 2% a year.
Overall, the TUC’s analysis in detail shows the extent of the problem:
UK growth after financial crises
|Period||Average annual growth % over recovery|
UK real wage growth after financial crises
|Period||Real wage growth % over a recovery|
Increase in public debt ration after financial crises
|Period||Increase in debt to GDP ratio|
The analysis compares the performance for economic cycles over 100 years. Cycles are measured from the peak year of one cycle to the peak year of the next. The cycle over the pandemic to the present is incomplete, but on latest forecasts likely to get weaker further into the future.
Figures are based on latest figures from the Office for National Statistics (ONS), historic data from the Bank of England and the Office for Budget Responsibility Public Finances databank. Figures for 2023 are based on the Bank of England November Monetary Policy Report forecasts, and for the public debt ratio the mid-year estimate from the ONS.
Lack of an economic plan
The TUC says the government’s economic mismanagement has turned Britain into a “stagflation nation” – depressing living standards and wrecking the public finances.
The union body says the UK desperately needs an economic reset – with investment in infrastructure and public services at its heart.
TUC general secretary Paul Nowak said:
The Conservatives failure to grow our economy has had dire consequences for working people and the country.
Living standards have been hammered, our public services have been brought to their knees, and government debt has skyrocketed.
This is the result of political choices. Far from fixing the roof – austerity blew a hole in our public finances and trapped the UK in an economic doom loop.
Under the Tories Britain has become a stagflation nation. We need a reset.
That means urgent investment in infrastructure and our public services to drive growth and deliver good, well-paid jobs across the country.
Featured image via the Guardian – YouTube
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