Economy of U.K Research Paper Example | Topics and Well Written Essays - 1000 words

Economy of U.K - Research Paper Example Employment situation The global financial crisis that hit the U.K. did impact of all sectors of the economy resulting in high employment rates. However, as the economy continues to solidify, additional jobs continue being created thereby resulting in a slight drop in unemployment rates. The latest employment figure shows that the unemployment rate in the U.K. stood at 7.6% in September 2013. This accounts for a drop of 0.1% compared to the previous quarter where the rate stood at 7.7%. CIA (par. 1). is worth noting that even though the unemployment rate continues to fall, it is unlikely that it will fall sharply due to the job losses experienced in the public sector. The welfare and pension reform introduced by the government is also likely to affect the rate of unemployment since it is likely to attract citizens to join the labor force (Osborne 5). Inflation Inflation is another major problem that U.K. citizens have been grappling with for the past six years. Reports show that the p rices of commodities in the country have been increasing at an alarming rate. For instance, the inflation rate in the country was only 1.30% in 2004 and 2.30% in 2007 when the global economic crisis began (BBC News 2). However, the rate increased to 3.60% in 2008 due to rising prices of goods and services marked by hard economic times. Nevertheless, the U.K. government has managed to contain the situation as the country continues to experience a decline in inflation rates every quarter. The U.K. inflation rate fell to 2.20% in October, down from 2.7% the previous month (BBC News 2). In fact, this marks the lowest rate since 2012. The major decline was registered in the transport sector where transport price declined by... This paper stresses that the U.K. economy has been one of the worst hit by the global financial crisis in Europe. This resulted in a fall in the country’s gross domestic product (GDP) to an all time low. However, GDP figures released recently indicate that the U.K. economy is on the path to recovery. The country’s GDP as of 2012 by purchasing power parity stood at $2.375 trillion according to the CIA. This stresses that the global financial crisis that hit the U.K. did impact of all sectors of the economy resulting in high employment rates. However, as the economy continues to solidify, additional jobs continue being created thereby resulting in a slight drop in unemployment rates. Inflation is another major problem that U.K. citizens have been grappling with for the past six years. Reports show that the prices of commodities in the country have been increasing at an alarming rate. The trade balance between the U.K. and other countries has not been good since 2007. This is attributable to trade deficit marked by an increase in the value of imports and lower value of exports. Research indicates that the U.K. has been importing goods more than it exports to other countries resulting in a wide trade deficit. The author talks that regarding imports and exports, the biggest U.K. exports for the past few years comprise of nuclear reactors, mechanical appliances, boilers, and nuclear rea ctors. The second biggest export items in the U.K. include mineral fuels and oils, and their derivatives including mineral waxes and bituminous substances.