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The UK Labour Market and the 2008 - 2009 Recession

Author

Listed:
  • Paul Gregg
  • Jonathan Wadsworth
Abstract
The recession of 2008-2009 inflicted a larger cumulative loss of UK output than any of the other post-war recessions. Nevertheless, employment rates remained higher than might have been expected given the experience of previous recessions. The main reasons for this appear to be a combination of high firm profitability levels going into the recession, supportive monetary and fiscal policies during the recession, reductions in real producer wages and relatively buoyant real consumer wages. Unemployment had reached its lowest levels for thirty years going in to the latest recession and has also remained relatively subdued through the downturn, certainly compared to previous recessions. A combination of lower inflow rates into unemployment, allied with a relatively higher outflow rate into employment, underlie this. As government support for the economy is scaled back and productivity growth remains low, it may be that it will take a long time for employment to return to levels last seen before the recession.

Suggested Citation

  • Paul Gregg & Jonathan Wadsworth, 2010. "The UK Labour Market and the 2008 - 2009 Recession," CEP Occasional Papers 25, Centre for Economic Performance, LSE.
    • Handle: RePEc:cep:cepops:25
    as

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    File URL: https://cep.lse.ac.uk/pubs/download/occasional/op025.pdf
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    References listed on IDEAS

    as
    1. Geroski,Paul A. & Gregg,Paul, 1997. "Coping with Recession," Cambridge Books, Cambridge University Press, number 9780521622769, September.
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    Cited by:

    1. Marco Percoco, 2016. "Labour Market Institutions: Sensitivity to the Cycle and Impact of the Crisis in European Regions," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 107(3), pages 375-385, July.
    2. Andrew Sutton, 2013. "On the determinants of UK unemployment and the Great Recession: analysing the gross flows data," Applied Economics, Taylor & Francis Journals, vol. 45(25), pages 3599-3616, September.
    3. Damian Grimshaw & Anthony Rafferty, 2011. "Social Impact of the Crisis in the United Kingdom: Focus on Gender and Age Inequalities," Chapters, in: Daniel Vaughan-Whitehead (ed.), Work Inequalities in the Crisis, chapter 13, Edward Elgar Publishing.
    4. Daniel Vaughan-Whitehead (ed.), 2011. "Work Inequalities in the Crisis," Books, Edward Elgar Publishing, number 14602.

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    More about this item

    Keywords

    labour market; recession; unemployment; wages;
    All these keywords.

    JEL classification:

    • J0 - Labor and Demographic Economics - - General
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers

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