The unemployment figures for the quarter to June made grim reading last week, 38,000 more people unemployed (21,000 of whom were women) and an unemployment rate amongst 16-24 year olds of 20.2%.
As the figures were released, markets were shuddering all over the world with anxieties over the eurozone and the USA’s loss of its ‘triple A’ finance rating.
Towards the end of the week, the markets continued to look rocky and the UK reflected on the causes and ramifications of the recent riots. On Friday, the Prime Minister decided to spend the afternoon at the test match, arguing that he needed to take a break to avoid a ‘fried brain’.
For the first time in decades, the state of our country and the world’s finances seem to be having a direct and tangible impact, for most of us, on our daily lives. Since the Coalition came to power in May 2010, the focus of our politics and national debate has been the deficit, the cuts and the still-stumbling global economy. A fortnight ago, we added the riots to that agenda. Last week we added rising unemployment.
Usually in an economic downturn, a significant proportion of the population is insulated from any serious personal harm, they ride it out. This time though, only the very wealthy are immune, the rest of us are finding it hard.
The numbers many of us were once able to ignore - redundancies and job losses, rising VAT, commodities prices on the stock exchange, inflation and the projections for economic growth - we now know are critical to our own, very personal economic wellbeing.
And wellbeing is the critical issue here. It’s no coincidence that we talk about economic ‘depression’ when growth stalls and the risk of a double-dip recession feels ever-present. Even at the height of early 1980s nuclear panic, I have never known our nation to be so gripped by anxiety and worry, so bleak in outlook.
It doesn’t take long in any family or network of friends, to find someone who has lost their job in the last twelve months or even someone who is still unemployed after six. Early retirement, forced redundancies, companies going into administration, government funding cuts to public services and charities - all of these things have economic and emotional consequences for individuals and their families. Those consequences when multiplied are even more devastating.
When the cuts began and concerns grew that the economy would stall, many made predictions of riots, higher rates of crime and increased domestic violence as families came under economic pressure. Well we’ve had the riots and we’ve not seen the crime statistics but I can tell you that, driving through Dorset last week, I saw the following headline on a local paper: “Domestic Violence Shelters Overflowing”.
We cannot avoid the emotional and social consequences of our economic torpor which raises an interesting question for David Cameron. Last year he announced his determination to address the quality of our national “wellbeing” as a measure of progress and success, in addition to the usual economic indicators. He argued that we were too focused on economic outputs, ignoring the value of more human states of being. Much of this was derided in the press as a “happiness” agenda but he had a serious and valid point. However, the Prime Minister and a large number of his policy advisors think that “happiness” and “wellbeing” are states of mind over which we have complete personal control, regardless of our economic circumstances. He concludes that with a bit of will-power, anyone can break free from the chains that shackle them and succeed. It’s a classic neo-liberal, personal responsibility, “pull yourself up by your bootstraps” argument.
The problem for Mr Cameron is that on current evidence, the very opposite is true.
More Than Money
The economic depression is affecting more than just our finances...
by Lucy Sweetman (23 August 2011)