ThisIsMoney points to an interesting graph comparing the current recession to some of the previous economic slumps.
The graph looks at the level of the UK’s GDP from its peak for the recessions in 1929-1934 (the Great Depression in the United States), 1979-1983, 1990-1993 and 2008 to the present day. The graph is known as the Profile of Depression, and is produced by the National Institute of Economic and Social Research.
If you were to take the graph of the current recession in isolation, it may well look as if we’re beginning to come out the other side. But compare it against 1929 and 1979 and things look a little less rosy. We’ve already been through a period that has been worse than the Great Depression era, and the last couple of months have given some hope that the recovery is on its way.
But during the recession of the early eighties there was a similar uptick after about a year, only to be followed by another dangerous dip, which slowly began to look more positive after about 2 years. It’s definitely worth bearing this in mind before we prematurely call the end of the recession.
The graph will be updated by the NIESR regularly, so we’ll keep an eye on how it develops.
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