Britain is being warned to brace for a prolonged stretch of weak economic growth and a sharp rise in unemployment, according to a bleak assessment from the ITEM Club. The report says the outlook has worsened enough that the number of people out of work could climb above two million.
The warning has been directed at new Prime Minister Andy Burnham as the UK faces growing pressure from events beyond its borders. Economists said renewed conflict in the Middle East is adding fresh disruption, while higher energy prices are creating another hit to already fragile economic conditions.
That combination of slower growth, rising costs and a weakening jobs market points to a difficult period for households and businesses. A weaker economy typically reduces hiring and investment, and the report suggests those pressures may last rather than fade quickly.
The ITEM Club’s findings add to concern over the direction of the UK economy, with energy costs once again emerging as a major risk. If disruption continues and prices stay elevated, Britain could face a deeper slowdown alongside a noticeable increase in unemployment.
