Sky News business editor Michael Wilson

The Prime Minister says he’s the right man to steer the economy through difficult times, stormy waters and so on, blaming international problems like the explosion in oil and food prices for our current woes.

Let’s hope he is. As I’ve been noting all week, there hasn’t been a slew of woe like this for a very long time.

The Governor of the Bank of England said ‘the nice decade is behind us’. That’s the nice decade where, courtesy of  the low cost imports from the Far East - which  kept inflation and thus interest rates low – we had a relatively stable economy, with lots of happy shoppers.

That’s over, pretty obviously. Yesterday’s return to rising unemployment is seen by many as the beginning of a trend.

According to a former head of the British Retail Consortium, we’ll see the big fallout in June/July, when the retail business – which has so far been absorbing its higher input costs from the manufacturers who supply them - as done its best to sell its summer stuff, been through its sales and then wallows in the doldrums as a few debt weary window shoppers drift by.

We’ve already seen the fatalistic reaction of one company to slimmer margins – on Tuesday Marks and Spencer supplier Northern Foods mothballed its Grantham foods factory and ‘opened consultations' with its 730 employees.

It’s not spelt out, but it’s pretty obvious that Northern couldn’t match the price reductions that M and S were asking for.

I’m guessing that many employers will be having similar thoughts. And for every full-time worker who loses his or her job, there’s often a part timer-who’ll go, too, somewhere down the line.

If we were facing a downwards blip in the economy, we might have expected to see employers hanging on to their workers, because they are expensive to sack and expensive to re-employ. That’s now a calculation which is out of date.

We’d like to start to monitor all this properly – we’ve had great input from our North East and Cornwall bloggers.

Would the rest of you be kind enough to let us know how what your local experience of the Great Downturn is?

Comments

[Margie O'Callaghan 29 May 2008 20:04:41]

Looking thro' the hindsight looking glass - from 'far, far away, - in Deep and Darkest Africa - known fondly as the "Warm Heart of Africa".....

Our 'almost namesake' Callaghan (ancient PM from the Wales?) once said that there was a 'wind of change blowing through Africa'.

Well, I think perhaps there is a Gale Force Wind blowing across those Cold Satanic Hills of England ?
and its certainly not going to blow away the massive AVERAGE DEBT of each household - and we cant all pretend we did'nt see a credit crunch coming - can we?
Time to 'pay the piper' perhaps?
A good and positive demonstration of 'we are listening' to the voters, could be that all MP's ensure that their 'second home' is passed-on - when they are voted out - to their successor. After all they gained their 2nd home simply because of the 'privilege' to be a representative of their constituents??
A small step for fairly well heeled MP's would be a 'great step' for those poorer supporters struggling to survive the rising costs!

Stop milking the system you MP's !!
Margie O'C in Lilongwe

[Annie, Durham 20 May 2008 08:17:40]

What I would like to know is how "Brown" has the gall to take the credit for all the good years and blame the USA for the bad. Surely if it is a world market as he keeps saying then the same world market has helped our prosperity in the past. It is this government and not the Americans who take 80p tax on fuel and all the other stealth taxes until the cupboard is bare. NOW we need a change of government .....please.

[Robert, Scotland 19 May 2008 10:16:22]

Kelly
It is a Politician's dream when a Voter says they would not vote for any other Party. That is why so many people are taken for granted and why elitism is thriving across the political spectrum. The willingness of some to accept the worst through mis-guided loyalty promotes the politician's delusion that they know best.
I have often criticised across the political spectrum but always balance it with credit where credit is due. Example; The importance you attach to leaving your home to your children, well no political leader better championed home ownership than Margaret Thatcher. She introduced the "right to buy", something Labour councils oppose to this day.
This type of "new think" leadership is what is needed to get us out of our current mess and I do not care which politicl party displays it, I just hope it emerges soon.

[Bill, Middle England 18 May 2008 10:22:27]

A bit like asking the Captain of the Titanic to take charge of the Life Boats!

[kelly 17 May 2008 10:39:56]

I AM ANGRY WITH GORDON BROWN THAT BOTH MY HUSBAND AND I LIVE TO WORK NOT WORK TO LIVE TO PROVIDE FOR OUR FAMILY BUT AM THANKFUL THAT WE BOTH HAVE JOBS AT ALL. HOW SHORT THE MEMORIES PEOPLE HAVE VOTE CAMERON AT YOUR PERIL LAST TIME CONSERVATIVES WHERE IN POWER HARDLY ANYBODY HAD A JOB TO SPEAK OF LET ALONE BE ABLE TO OWN THERE OWN HOME. WHOEVER ARE IN POWER THE WORKING CLASS ESPECIALLY WILL STRUGGLE BUT IT IS THE DIFFERENCE BETWEEN HAVING A HOME TO LEAVE TO MY CHILDREN WHEN IM DEAD AND GONE OR DROWNING IN DEBT WITH NO JOB NO HOME I WILL VOTE LABOUR EVERY TIME RATHER THAN HAVE THAT UPPER CLASS TWIT CAMERON AT THE HELM. THOSE WHO ARNT PREPARED TO STRUGGLE FOR A WHILE ARNT LIVING IN THE REAL WORLD GENERATIONS BEFORE US WORKED ALOT HARDER FOR ALOT LESS THE ONLY THING THAT REALLY UPSETS ME IS AS A FAMILY OR A COUPLE WE DONT GET MUCH QUALITY TIME AS ONE OR OTHER IS ON WAY TO WORK BUT THATS THE PRICE WE HAVE TO PAY FOR HAVING A FAMILY AND I WOULDNT CHANGE IT FOR THE WORLD.

[Elizabeth Davies Cape Town 16 May 2008 18:42:46]

Sorry...on the outside looking in. Gordon Brown is the "has been never was". Hopefully he will call the general election all of Britain is waiting for. Selling off the gold reserves of the UK was his biggest crime, buying a failed bank was another, how much more will the British public need to endure from this man! He has crossed the Rubicon never to return!

[Liam Northants 16 May 2008 10:34:47]

I was under the impression that Darling was the chancellor now,it's down to him to steer us through this difficult time,typical Brown he just cannot leave the job to another person , that tells me he doesn't trust Darling,yesterday it was him telling us that it was him that did this , him that did that all me me me for the last 11 years, the guy is so far up himself.& can someone have a word with him about constantly banging his clawed fingers on the podium near the microphone, what a really annoying habit it is ,i thought i was listening to a drummer in the background

[Alan, Germany 16 May 2008 09:54:33]

I have rarely commented on these boards,except to voice concern at the way the British economy was being run,in view of the fact that my children and grandchildren live there.
The bubble that has been the British economy for the past 11 years has now,finally, burst and there are hard times ahead for a great many people.
Brown is most certainly not the man for the job that needs to be done.
His management of the economy has been nothing less than a total disaster - and this comment is not with hindsight, I've been saying this for a number of years.
A non-producing economy, relying on the City for the majority of GDP, is unhealthy.
The delussion that Britain is a world power and is somehow responsible for sorting the ills of the rest of mankind is unhealthy.
The lies and double standards of government are unhealthy.
The fact that 75% of personal debt within the 27 countries of the EU is unhealthy.
The senseless application of EU directives, without modification to suit the values and mores of the people, is unhealthy.
Sadly, my homeland is now the sick man of Europe and I fear that it will be a very long haul to restore the economic health and standing of Britain in the international community.

[Dennis, Cramlington Northumberland 16 May 2008 08:05:02]

[ED-16 May] "..........and dodgy banks run by crooks, and con artists who call themselves “bank executives” that then need more taxes to try and put right, or bail out......."

Well Ed, it does appear that you have read a few headlines and been captured 'hook, line and sinker'.

Perhaps if you were to run a flagship 'Top 100' UK business, supreme and profitable, meeting people's needs for mortgages and savings interest, and a source of employment for nearly 7,000 people, in an area where anything decent is acceptable - after the decline of the coal-mining, shipping and heavy industrial base, you might feel differently.

Especially when you then find your business trashed by some placed 'leak' of confidential information, plus for the most part erroneous and scandalous tit-bits of 'news', causing unprecedented and widespread national panic and a 'bank run' which has made some 'players' millions, perhaps billions of pounds.

A 'bank run' not un-aided by an inept and incompetent Government, and which brought your fine company to it's knees, and so throwing thousands of people out of work, and the business owners forcibly deprived of their property and due compensation being 'organised' to probably be NIL....

.....then, perhaps you, too would not be happy as being referred to as a 'crook'.

Shame on you.

[Robert, Scotland 16 May 2008 07:17:23]

James Marske
I think your post is excellent, it is humorous, but, does not lack insight. The very essence of Britishness, laugh in the face of adversity and "don't let the ******** grind you down. If the Brown & Darling fog ever clears, make a sandcastle for me, everybody might need one after receiving their latest mortgage rate.

[Ed 16 May 2008 01:24:21]

How much longer is Mr. Brown going to keep blaming the credit crunch as if he and his policies haven't contributed to it's ease of affecting our economy? He conveniently ignores that his constant raising of taxes and wasting it on dodgy projects, and dodgy banks run by crooks, and con artists who call themselves “bank executives” that then need more taxes to try and put right, or bail out, has added to the tons of weight that is causing the crunch in the credit. And his grand idea to fix this? Why raise even more taxes of course! After all it, worked five years ago! He must think he’s living in the Palace of Versailles in the 1770s, and we all know what happened then. More cake Prime Minister ?

[Eamonn In Chigwell 15 May 2008 18:30:28]

I think alot of people are missing the point regarding the state of the economy and Britain today
The socialist ideal of government has always been tax and spend.
And this government has used this edict to staggering effect in the last 11 years.
Blaire did all the damage and dissapeared into the distance leaving very poor politician in charge to try and pick up the pieces

[Robert, Scotland 15 May 2008 18:02:13]

I do not think Gordon Brown is the best man to lead us through these difficult times. I draw this conclusion from his inability to readily foresee problems when implementing policy and his intransigence to alter course when the flaws become self-evident. He is incapable of holding his hands up and admitting he got it wrong.
The 10p fiasco is a perfect example, his own Party had to reach the point of implosion before he conceded. On oil prices it was a world order he partly ordained through complicity in an illegal war that has brought us to $120+ a barrel. Care for the elderly is going to be an issue over the next 20 years, but, how much more difficult has it become since Gordon destroyed Final Salary schemes (except for civil servants, plus a continued right to early retirement)and peoples appetite for personal pensions by the abolition of the pension fund tax credits. This decision based on his delusion he had done away with "boom & bust", he took the advice of the "Stepford Child" Ed Balls, that the markets would always rise.
Such inflexibilty of character and thought are not the attributes required to guide us through the next few years.

[james marske by the sea 15 May 2008 17:23:19]

hello we live within 500yds of the coast that should give you a pointer about my age no metres here, unless they are for the gas. anyway over the last week or so while London basked in glorious sunshine we had fog. Similar to that you get from brown and darling,the northeast is famous for its history of viking raids always when the fog was at its thickest. rape and pillage was the thing then. well centuries later we still have rape and pillage but they do it by confusing budget statements,here I am 69, with a small pension and getting about £11,000 a year and have to pay income tax .My government pension and tax allowances has risen by £4 per week my council tax by £2 per week my petrol by, who knows? my food just keeps going up, my energy cost up by 15% etc. plus I have to sort out all my household waste and put it into different containers so I work harder and pay more.
Brown says infaltion is at 3% he obviously did not pass his 11 plus because anybody will tell you it is more like 13%.
His he the man to "save us" NO . quite frankly lets have scottish independence and get rid of the labour party forever, that is the ONlY reason he wishes to save the status quo. to allow him and his fellow scottish cabinet members save their jobs,

[simon norfolk 15 May 2008 16:56:12]

Gordon Brown couldn't steer his way out of a wet paper bag. He will go down as the worst Chancellor and PM in history. His 'successful' 10 yrs as Chancellor were built on a facade of public borrowing & private debt plus the fantastic economy left to him by Kenneth Clarke.

I agree with Derek, we're on the edge of bankruptcy and we've got the most inept Government in a lifetime.

[Michael Cornwall 15 May 2008 16:00:18]

I will try and keep you up to date with life on the street,but right now my mind fades me, I'm a bit too old my hair is too long and too white. BUT I think I remember the basic rules of a knife fight.
1 Dont panic
2 Check out opposition
3 See who your back up is if there is anyone called Darling ..... Forget all other stages and RUN

[garyturk blackwood gwent 15 May 2008 15:42:54]

i hope the voters at crewe are not conned by this con man

[purps, chelmsford 15 May 2008 15:11:56]

The message I got today is Brown is Chancellor, poor old Alistair.
We now have a job share PM/Chancellor the same as Scottish minister/defence minister and Browne has made a right old pigs ear of that position.

He talks about fiscal cycles, but when you are the one saying they start at this point and finnish at this point any fool can bend the figures, teh fact is the UK has been taxed to high, we need lower tax and lower VAT.

If he was bold and slashed spending on the NHS and cut Tax he would make the shortfall up, but thinking outside the box was never the great leaders area of ex[ertise.

Roll on two years, perhaps the Queen could fire him for being useless before we get tHE chance.
Sorry for typo's but Brown makes me violent

[Khalid 15 May 2008 14:32:34]

Sir
What bewilders the mind is that, if recent memoirs are to be believed, then assuming the fact that many an econimcal booby trap was planned to ensure the vacating of a certain premier office, the confidence no doubt speaks volumes for a person capitulated with the need for a figure or two.
Now, [What's Up] with the economy is down to the antics of the [4 Non Blondes] whom have allowed the nation to be ridden with more debt than planned, let alone predicted, one that has'nt been assisted by virtue of the shananigans of more obmudsman than certain members claim to have had dinners.
Whilst indeed good times are somewhat restricted, prudent voters have managed home economics within budget, no matter how stringent the feedback from those wanting more.
For all intents and purposes, good times will return once the nations' national debt is eradicated and those in control of the purse strings apply policies that are fit for purpose of economical stability and not just because they want to remain elected, as the case may be.
All in all, the question that arises, who is that marvel that can lead us through murky waters created by murky politics Dave?

[derek parrott, plymouth, devon 15 May 2008 13:42:46]

So Flash in the pan Gordon is not going to resign, he is going to get on with the job. He doesn't even know what the job is. He is a fool and the rest of parliment must be bigger fools by allowing this twit to continue in offce. Someone please step up and save my country because this country is on the verge of going bankrupt.