General

The "World Economic Outlook" report released by the International Monetary Fund recently predicted that the British economy will grow by 6.8% this year. The British "Guardian" pointed out that the UK is expected to become the fastest growing country in the G7. However, many economists pointed out that the background of this number one was that the British economy shrank more than other advanced economies last year.

At the beginning of March this year, the United Kingdom gradually unblocked it again. After the economy restarted, the pace of recovery accelerated. However, supply chain problems, gas station shortages, high natural gas prices, labor shortages, high inflation expectations, and post-Brexit trade disputes between the United Kingdom and the European Union Factors such as continued fermentation may make the UK economy lack of stamina.

The International Monetary Fund specifically mentioned inflation risks in its report. It believes that under the circumstances of high uncertainty, overall inflation in advanced economies, emerging economies, and developing economies is expected to return to pre-epidemic levels in mid-2022. But there are big differences between countries. In terms of fiscal policy, countries will have to act cautiously between controlling inflation and giving stimulus to achieve economic recovery.

British Prime Minister Johnson recently promised to create a "high-wage, high-skilled, and high-productivity" economy. Cheap foreign labor cannot always be counted on to solve the problem, but the business community believes that this statement is not pragmatic enough. According to data from the National Bureau of Statistics of the United Kingdom, the number of job vacancies in the UK in the third quarter soared to a record 1.102 million, while the number of unemployed people in the UK was 1.5 million. The mismatch between labor supply and market demand is prominent.

According to the British Logistics Association, the current average age of truck drivers in the UK is 57 years old and there is a gap of 90,000, which puts pressure on retailers and their supply chains. After Britain’s “Brexit”, 14,000 EU drivers left the UK, and the epidemic resulted in the cancellation of driving license exams for 40,000 people. Compared with driving a truck, Britons are more inclined to work in indoor places such as cafes. The British Retail Association stated that the shortage of truck drivers will continue to worsen by Christmas, when gifts and other products may increase in price.

"Financial Times" quoted former British Telecom chairman Mike Luck as saying that Britain is facing a "perfect storm" in which energy costs, labor supply, supply chain and inflation are superimposed. Although many of the challenges are global, Britain’s “Brexit” has further exacerbated these problems. "The medical, hotel and professional services industries are facing labor shortages, which not only push up wages, but may also inhibit growth."