Five key economic indicators in UK
The United Kingdom is one of the largest economies in the world. It is ranked 6th in terms of GDP and 12th in the Human Index. During the 18th, 19th and 20th centuries, the UK dominated the world economy and was considered one of the greatest economic giants. However, this changed as its popularity declined and the British Empire fell. Despite the fall of the British Empire, the UK still maintained a healthy economic growth of 6% average during the 1990s and early 2000s.
However, the 2008/2009 economic recession period dealt a fatal blow to the UK’s economy and experts state that the economy fell at least 7%. The recent times have seen the country’s economic situation improve. Nevertheless, the country still has a long way to go in terms of recovering from the economic turmoil. There are a number of indicators that analysts use to determine the economic indicators of the United Kingdom.
- The Gross Domestic Product (GDP) of United Kingdom stood at $2.8 trillion as at June 2014. The GDP is used to measure the country’s economic prowess and currently UK is ranked at 6th place in the entire world. Agriculture contributes the least to the UK’s GDP while services contributes the most towards the GDP. Analysts state that this figure is an improvement of 0.8% from 2013. The GDP is expected to grow by less than 1% by the end of the year.
- Unemployment Rate. The rate of unemployment in the UK is currently at 6.4% and even though there are over 2 million unemployed people in the country, this figure is a slight improvement from the previous situation. During the recession period, the unemployment rate escalated to 9% but gradually reduced as the economic situation returned to normalcy and firms began hiring people again.
- Trade Balance. The trade balance is the comparison between the exports and imports. Currently the UK imports more goods than it exports and this is evident in the country’s negative balance of trade which stands at $3,348 million.
- Industrial production. Although industrial production has improved UK still lags behind compared to its European counterparts such as Germany and France. The industrial sector only contributes 15.2% towards the country’s GDP and employs a mere 18% of the population. This shows that this sector has not yet been exploited enough to make a significant contribution towards the UK’s economy.
- Financial sector. Even though the recession period left many banks and lending institutions on their knees, there has been a slight improvement in the UK’s financial sector. Fewer banks are running bankrupt and inflation rate is lower than during the 2008/2009 fiscal year. The country has around $95 million in gold reserves.
Generally the UK is witnessing an improvement in its economy and analysts predict that the country will grow and recover fully from the financial crisis effects that almost crippled it. Even though its external debt is still high, the country is expected to improve and attract more investment in its manufacturing sector.
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