So do we all think there is a recession on the way or are you still hopeful we'll avoid one?

[Callisto]

Barratt housing have announced this morning that they are expecting to lay off 1200 workers having experienced a near 50% drop in house sales recently. Bovis and Redrow have also laid people off. The City is, allegedly, laying people off too. So with unemployment on the rise (I've heard 2 million will become unemployed in the next couple of years), manufacturing shrinking for the last two months, inflation running at around 9.5% and no end in sight to high oil prices, is there any way at all we can avoid a recession? And do any of you think that the Govt can do anything to prevent it?

[mrsruffallo]

I don't agree that most people have borrowed with abandon, although of course that element exists.
I think many families are in debt because they needed credit just to get by- many people do their food shopping on credit cards, for example.
We live in an extraordanarily expensive country where wages have not risen in line with cost of living.

[noddyholder]

I know a lot of people who have.People on average wages with big jeeps holifdays twice a year and several who have remortgaged to pay for private schools when there are perfectly good local schools.I do agree that the banks and borrowers both acted irresponsibly The boom in the high street was not spending on essentials sales of cars and sofas rocketed for example.

[mrsruffallo]

I think that kind of image concious lifestyle should be athing of the past, you are right.
It is silly and a bit sad.

[noddyholder]

Lets hope so.

[Oliveoil]

I know people that had the same equity as we have but have pissed it up the wall on cars and hols and clothes etc, extensions for the house etc

yesterday I got a fake cheque from Barclaycard for £8K with "Mrs Oliveoil" on it - tag line said "you could have a real one in 4 days"

I think this is outrageous and have told them to stop but still they arrive

[LadyMuck]

It is a huge and complicated picture. My personal fear is that a lot of knowledge-based jobs have been driven overseas, probably never to return. We may have more people going into tertiary education but the numbers in sciences have dropped off completely and so many vocational degrees are not worth the paper they're written on. And at the same time we have a generation growing up with a great sense of entitlement.

Labour have fiddled with the corporate tax system too far for big business to trust them. Those companies which can imigrate have. More may follow. The demands of the public sector are becoming crippling. Billions have flowed into education and health (oh and a war or two). There are no more treasure chests left to raid. We are going to be left with a high level of tax to pay either directly (compare road tax, stamp duty with 97 levels), indirectly (fuel duty, air passenger tax, landfill taxes) or passed on by companies (3G licence costs).

[LadyMuck]

It is a huge and complicated picture. My personal fear is that a lot of knowledge-based jobs have been driven overseas, probably never to return. We may have more people going into tertiary education but the numbers in sciences have dropped off completely and so many vocational degrees are not worth the paper they're written on. And at the same time we have a generation growing up with a great sense of entitlement.

Labour have fiddled with the corporate tax system too far for big business to trust them. Those companies which can imigrate have. More may follow. The demands of the public sector are becoming crippling. Billions have flowed into education and health (oh and a war or two). There are no more treasure chests left to raid. We are going to be left with a high level of tax to pay either directly (compare road tax, stamp duty with 97 levels), indirectly (fuel duty, air passenger tax, landfill taxes) or passed on by companies (3G licence costs).

[noddyholder]

Lm that is terrifying.

[dinny]

L&S, to the consumer it feels like recession

[bozza]

Well yes ladymuck, it is a a fear, as I sit here, transferring my 12 years of IT knowledge to some Indian nationals.

[LadyMuck]

I worked for a large multi-national company. The CEO said that to keep up we needed to recruit at least 1,000 science graduates every year. The labs are based in UK and near-continental Europe. In 2003/4 I believe that there were a total of 97 applicants who had suitable degrees.

India came up with proposals which would allow the company to give certain direction into the curriculum for undergraduates, and partner with some of the universities as well as pretty much guarenteeing a minimum of 5,000 applicants per annum. Oh and they would be paid currently about a third of the European salary.

No-brainer for the company (who have also now moved their HQ out of the UK).

[Page62]

just on the housebuilders alone:

Persimmon cutting 1,100 jobs
Bovis Homes cutting 400 jobs
Redrow cutting 350 jobs
Taylor Wimpey cutting 1,100 jobs
Barratt Devts cutting 1,200 jobs

all those families...............

[Callisto]

Lady Muck - I completely agree. How can children get excited about the sciences (which are about as exciting as you can get if properly taught) when hardly any of their teachers have science degrees, plus the amount of money spent by the Govt on R&D is miniscule and so now we have a situation where we desperately need to build nuclear power stations and yet don't have the skills base to do so.

There have also been reports of graduate wages dropping because the quality of those graduates is so poor - companies are having to fund remedial reading and writing classes just so that these people can do the job.

The more I find out about the realities of the UK's economy the more I feel that we are really, deeply in the shit as a nation, with no real way out. I can't see how Britian will retain its status as a leading world power.

[nkf]

I think there will be a recession and I'm worried.

[BouncingTurtle]

I think we are heading for a global recession.
I'm certainly quite worried for my own family - both DH and I have jobs are pretty secure because of the industries we work in. But I want to look for a job closer to home as when I return after ML I will be facing a £170 fuel bill a month, but even with nursery costs it still won't be worth me staying at home! But I don't rate my chances of finding a closer job on similar money...

[dilemma456]

Message withdrawn

[dilemma456]

Message withdrawn

[MrsTittleMouse]

I think that we will have a recession. Not because the media are talking us into one, but because things have become so crazy for so long. House prices especially have been treated as though they will rocket up and up, and people have been getting into silly amounts of debt (encouraged by the banks).

I actually think that it's good to have a bit of a correction. But I would much rather that we hadn't got ourselves into this situation in the first place, so that we wouldn't need a correction.

Fingers crossed that DH keeps his job...

[ConnorTraceptive]

I think we are already there, it's just not affected everyone yet. DH works in the construction industry and we've noticed a decline in work since last november. DH's income has been down by 25% since new year and next week he has no work at all.

I think the only positive is that we started cutting back last November and kept christmas costs low and have really tightened our belts so this is isn't such a sudden shock to our finances.

That said it's still a scarey time

[Jojay]

I think we will go into recession, and I totally agree with earlier comments that many people feel nowadays that they are somehow 'entitled' to a lifestyle that they simply cannot afford.

Easy credit and rising houseprices has made it possible to borrow money and give an illusion of 'wealth' but it can all crumble just like that(clicks fingers) when the debts are called in.

I'm seeing someone go through it now. They've lost their car, and their house, and are in rented accommodation waiting for a council house. They have a low income, yet would never buy anything second hand, or anything less than a brand name. They had a huge overseas wedding, knowing they were had thousands of £££'s of mortgage arrears.I think they're barking.

I think we'll see repossessions soar, and taxes rise to fund those going into council accommodation.

[QueenMeabhOfConnaught]

All sorts of organisations are cutting back - my dh works in the public sector and he is being made redundant. I can just about keep things going (luckily (?) I work in a sector which shouldn't be affected) but it will be tough.

[greenelizabeth]

This is a bimbo comment, but here goes anyway....... everybody I know is getting their long hair cut short. That is proof of a recession according to my hairdresser who has lived through a couple of them now.

[nkf]

Really?
Any other signs?
I think the misery lit is a sign of a recession. I think people like to read about people who are worse off during hard times.

[noddyholder]

House price falls will only affect those who have bought at over inflated prices in the last few years and so they will have to sit tight or risk negative equity,I think its unlikely the govt will do anything to halt this as they need the stamp duty revenue so a correction of significant% will get things moving.The worst aspect is definitely the job losses and how gordon can say we still have record employment i'll never know when the papers are reporting redundancies everywhere.i agree aomething had to change we couldn't go on with the mad consumer cultuer built on debt.

[nkf]

If house prices fall 25% that will be quite a lot of people affected. And it's when people can't sit tight that the trouble starts.