Recession and unemployment: the worst is yet to come

The Times
"To date, the decline in GDP we have seen is similar to that of the recession of 1979-81, when GDP fell by 6 per cent. Unemployment surged from 1.4 million to 2.5 million people. The recession of 1990-91 saw a fall in GDP of only 2.5 per cent but a 700,000 increase in the unemployed. .....The performance of the public finances during this recession has been shocking, deteriorating by about £130 billion a year. Adjusting for differences in the scale of the economy suggests that government borrowing increased by £38 billion in the 1979-81 recession and by £53 billion in the 1990-91 recession. Much of the worsening is related to the collapse in taxes from the financial and housing sectors, which had proved to be particularly important sources of revenues to the Exchequer. ....From the perspective of unemployment, the worst is probably still to come. As the UK recovered from the recession of 1979-81, unemployment continued to rise, peaking at 3.3 million people in 1984. It was not until 2000 that the unemployment rate finally returned to its 1979 level.