MICROECONOMICS AND BUSINESS

ENVIRONMENT
ASSIGNMENT
1.UNITED KINGDOM GDP GROWTH RATE
In Q3 2021, the British economy grew by 1.3 percent quarter on quarter, down from
5.5 percent in Q2 and below expectations of 1.5 percent. Following the further
relaxing of limitations and reopening of the economy, the main contributors were
hospitality (30%), arts and recreation (19.6%), and health (3.5%), according to
preliminary estimates. Manufacturing, on the other hand, lost 0.3 percent as recent
supply limitations weighed on the sector, notably rubber and plastics manufacturing,
transportation equipment (-8.2 percent), and motor vehicle sales and repair (-13.3
percent ). While underlying inventories fell, household consumption (2 percent) made
the largest contribution to expenditure.

GDP GROWTH RATE-FORECAST:

The British economy advanced 1.3% on quarter in Q3 2021, lower than 5.5% in Q2
and below forecasts of 1.5%. The largest contributors were hospitality (30%), arts and
recreation (19.6%) and health (3.5%) following the further easing of restrictions and
reopening of the economy, preliminary estimates showed. On the other hand,
manufacturing shrank 0.3% as recent supply constraints weighed on the sector,
namely manufacture of rubber and plastics, transport equipment (-8.2%), and sales
and repair of motor vehicles (-13.3%). Household consumption (2%) also made the
largest contribution to expenditure while there was a fall in underlying inventories,
likely reflecting some of the recent supply chain challenges, and a negative
contribution from net trade due to a fall in exports (-1.9%). The economy is now 2.1%
below its pre-pandemic level in the last quarter of 2019.
2.GDP PER CAPITA
The Gross Domestic Product per capita in the United Kingdom was last recorded at
41811.36 US dollars in 2020. The GDP per Capita in the United Kingdom is
equivalent to 331 percent of the world's average.

3. GDP AT CONSTANT PRICES:

GDP Constant Prices in the United Kingdom increased to 553412 GBP Million in the
third quarter of 2021 from 546556 GBP Million in the second quarter of 2021.

4) X-M (BALANCE OF TRADE)

The UK trade deficit widened to GBP 2.8 billion in September of 2021 from a
downwardly revised GBP 1.9 billion in the previous month. It was the largest monthly
trade deficit since January. Imports rose 2.9 percent to a nine-month high of GBP 53.3
billion, as purchases of goods surged 3.8 percent while those of services went down
0.2 percent. Meanwhile, exports advanced at a slower 1.2 percent to GBP 50.5 billion,
with sales of goods rising 1.9 percent and those of services growing 0.4 percent.

5)GOVERNMENT SPENDING (G).AND INFO ON C, I (  IF

AVAILABLE)
Government Spending in the United Kingdom increased to 117492 GBP Million in
the third quarter of 2021 from 116448 GBP Million in the second quarter of 2021. 
6)CONSUMPTION (C)
United Kingdom - General Government Final Consumption Expenditure

General government final consumption expenditure (constant LCU) in United

Kingdom was reported at 373240314000 LCU in 2020, according to the World Bank
collection of development indicators, compiled from officially recognized sources.
United Kingdom - General government final consumption expenditure (constant
LCU) - actual values, historical data, forecasts and projections were sourced from
the World Bank on November of 2021.

United Kingdom - Household Final Consumption Expenditure Per Capita 

Households and NPISHs Final consumption expenditure per capita (constant 2015
US$) in United Kingdom was reported at 24819 USD in 2020, according to the World
Bank collection of development indicators, compiled from officially recognized
sources. United Kingdom - Household final consumption expenditure per capita
(constant 2000 US$) - actual values, historical data, forecasts and projections were
sourced from the World Bank on November of 2021.

7.RANKING IN TERMS OF HDI AND  PC.Y.

The HDI is a summary measure for assessing long-term progress in three basic dimensions of
human development: a long and healthy life, access to knowledge and a decent standard of
living. A long and healthy life is measured by life expectancy. Knowledge level is measured
by mean years of schooling among the adult population, which is the average number of
years of schooling received in a life-time by people aged 25 years and older; and access to
learning and knowledge by expected years of schooling for children of school-entry age,
which is the total number of years of schooling a child of school-entry age can expect to
receive if prevailing patterns of age-specific enrolment rates stay the same throughout the
child's life. Standard of living is measured by Gross National Income (GNI) per capita
expressed in constant 2017 international dollars converted using purchasing power parity
(PPP) conversion rates.

United Kingdom’s HDI value and rank

United Kingdom’s HDI value for 2019 is 0.932— which put the country in the very high
human development category—positioning it at 13 out of 189 countries and territories.
Between 1990 and 2019, United Kingdom’s HDI value increased from 0.781 to 0.932, an
increase of 19.3 percent. Table A reviews United Kingdom’s progress in each of the HDI
indicators. Between 1990 and 2019, United Kingdom’s life expectancy at birth increased by
5.6 years, mean years of schooling increased by 5.3 years and expected years of schooling
increased by 3.8 years. United Kingdom’s GNI per capita increased by about 51.3 percent
between 1990 and 2019.

8)ANY MAJOR ECONOMIC EVENT/ UPDATE IN THE

COUNTRY.

Half of businesses report that their workforce has returned to their normal place of
work

 Half (50%) of UK businesses that had not permanently stopped trading reported their
workforce had returned to their normal place of work in early November 2021. This
has increased from 34% in early September 2021 and from 20% in late April 2021.
 Industries with the highest proportion of businesses reporting their workforce had
returned to their normal place of work were accommodation and food service
activities (75%) and arts, entertainment and recreation (67%).
 More than one in six (18%) businesses that had not permanently stopped trading
reported that they intend to use increased homeworking as a permanent businesses
model. In contrast, 35% reported they would not be using increased homeworking as
a permanent businesses model, down from 40% in early October and down from a
peak of 68% in late November 2020.

 In early November 2021, approximately half of businesses not permanently stopped

trading reported their workforce have already returned to return to their normal place
of work

 Expectations of returning to the normal place of work, businesses not permanently

stopped trading, weighted by count, UK, 1 November to 14 November 2021