According to the article, the UK economy has returned to recession "after shrinking by .2% in the first three months of 2012." The UK economy was last in recession in 2009. The article talks about the decrease in construction and production industries as well as a decrease in government spending. As we've learned in class, an increase in government spending and business investment promotes long term economic growth. Increased government spending in creating jobs, as well as tax cuts should be used to increase consumer spending. However, in the UK, the deputy chairman of industry body Judy Lowe said, "The huge cuts to public spending - 25% in public sector housing and 24% in public non-housing and with a further 10% cuts to both anticipated for 2013- have left a hole too big for other sectors to fill." Based on this article and the last blog post about the UK, it is clear that consumer spending is suffering, especially in the public housing sector.While this is an oversimplified solution, efforts could be made to help the UK citizens with affordable housing initiatives, which could then spur more consumer spending and help aid the suffering retail industry, for example.
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