The UK's Decaying Economy: A Country Without Solutions? 

But UK has the lowest engineering degree ratio of college graduates among major economies. Manufacturing competitiveness is hard to restore once lost. It takes lots of infrastructure, time, expertise, talents, etc. No country has succeeded in "re-industrialization" after post industrial economy. Even USA couldn't

As Mum used to say, "they know the price of everything and the value of nothing". Everything here in the UK is done as shoddily as possible, or not all! so as to extract the most possible profit.

everything in britain is short-term whether they are political or economic decisions...

Nearly all of our economic problems stem from property prices being too high. Nobody has disposable income anymore. Stop property prices increasing for the next 10 to 15 years and allow wages to catch up (so average house price are 3x average salary again, instead of 7x), then prevent property prices from ever increasing faster than wages again, which was a stupid idea in the first place.

The main problem in the UK is depression….its feels like a sick society… everyone depress to clinical level… young and old… 10 million today in a working age r economically inactive.. that they r not working neither looking for a job… one forth of working age population r on benefits… even more scary,, another 10 millions who actually working r suffer from depression, stress and anxiety and chronic pain which is likely due to mental problem… if these 10 millions left work, the UK would bankrupt.. today 23 millions receive social benefit… on average of 15 thousands pound per person..theres no economical module can support this… imagine if these 340 billion of pound spent on benefit would spend on investment, UK would be richer than any other nation… depression in the UK caused by multifactorial causes..weather,, ppl,, regulations and legislations,, social breakdown,, relationship breakdown and economy uncertainty… ppl and the government should work to sort out these issues… apart from the weather which ganna stay miserable forever

The German economic model only works if you get cheap gas from Russia. Now all their companies are moving to the US

There was a classic line from that Chernobyl miniseries a couple years back. That a lie told owes a debt to the truth and in time that debt is paid. There's something similar going on with economic policy in the UK and elsewhere. Since the end of the Cold war. There were certain assumptions made about the economy and what economic growth meant. There have been multiple opportunities to make course corrections or adjustments to that vision to make growth possible in a way that benefits the entire country. Instead, at every single decision point, leaders decided on the choices that enriched a small chosen few. As each missed opportunity stacks up, the UK is now at a point where changing course is going to be very very hard. The interest is coming due.

There are always solutions, just not quick solutions. The solutions are known. Ireland was poor 50 years ago; they did the right things and got rich. The British just need to get down to work, to do the things that attract investments. And consume less, and invest the savings into productive assets.

I live in the UK and it’s frustrating because I see the potential of my country and how it’s falling behind peer nations. I have 3 things I would focus on: 1 - reducing energy bills (a great way to start would be to get rid of the short sighted ban on onshore wind power that Cameron brought in, because onshore wind is by far the cheapest form of energy in the UK) 2 - I would create government backed venture capital funds that have the goal of supporting 1000 British based unicorns in the next 10 years (we need growth and startups are by far the best at that) 3 - a massive boost in expanding and modernisation in the rail network and a massive expansion in cycling infrastructure, these would have massive benefits in terms of the climate crisis and improved public health which would then boost productivity.

You didn't mention the UK's non-presence in tech which is a high growth industry and you didn't mention the public sector's lack of productivity as dragging productivity down.

The place is an stinking dump. It’s not the island I was brought up in. The place is utterly infested .

Britian will become a backwater on the periphery of other Empires again as it once was during the Roman times

I have to agree from my own experience managers are a menace in UK. And that combined with unions and lack of direction ends up in nothing being done or done very poorly, because everyone just looks at whats now not what will be in the future.. It creates situations where rules in a company make no sense and are slowing down productivity and killing any morale still left.

They never mentioned massive low wage migrantion year after year after year

Very informative video. As a US investor in Britain companies such as British American Tobacco, Unilever amd Legal & General, I like to see where your economy is going. The lack of productivity is also affecting Canada and why it's right behind you. Our lack of fiscal responsibility over here in the US will eventually lead the dollar to follow the pound in weakness.

How is productivity going to be high if hard work is penalised with heavy additional taxation? If I want to dig myself out of loans by taking up weekend/ out of hours work I get obliterated by additional tax. Not much incentive in working overtime/outoff hours here.

Ridiculous house prices, coupled with ridiculous stamp duty tax on money you have already been taxed on! Young people forced to drown in debt

Germans invest for the long term.. UK is short term and wants quick results. In addition you have a large section of the population that does not want to work/can't/ or it is not "worth it to them". Go to a developing country and see the people running from place to place,working and delivering. UK doesn't work like like and is not competitive. Sad really

The main problem is that the government and the House of Lords are stuck in the 1950s and Great Britain will only advance if the old government is swept away and a new modern system is built upon the old.

Is too much investment in the UK going into real estate? If yes, is this investment driving efficiency and productivity as much as possible? How about a vacancy tax on both residential and commercial real estate? No matter if for a land or a month, an empty property is inefficient use of land, and the building on the land. This means its inefficient use of the materials in the building and the labour that went into making the building. The empty property tax should be strong enough to force AirBnBs, hotels, motels (and other vacant properties) to be rented on low demand days - even if at a loss. This will lead to some short term rentals being converted back into long term rentals. It will make residential and commercial rent cheaper. Giving consumers and businesses more money to spend elsewhere. And if some investors decide to leave the real estate market, they’ll invest elsewhere (most likely pushing investment into improving productivity).

Relying on services as the main focus of Britain's economy is probably a risky strategy, since the coming AI revolution will probably wipe out many service jobs, in the same way that Amazon has already devastated high street retail outlets.

It obvious. We pay so much tax yet all public services are privatised

UK services industry is doing very well. Last week only UK was ranked 4th in world by Total exports ahead of all the European countries. The thing is there are problems in all of the EU countries but UK takes the spotlight (even though it’s doing well) because of the Brexit.

5:35 is a weird analysis the graphs show a deviation from the norm, and you're saying it is 30% behind? this is really hard to relate to actual real numbers.

Your videos are so very well made and break down extremely complex matters into comprehensive language. Excellent food for the brain! Many thanks from Sao Paulo

Mass Deportations is a policy that can cure many ills; if the economy needs low skill workers then we don't need compulsory education up to aged 18 & if we need medical professionals we shouldn't keep restricting the numbers of those being trained. We are a relatively small country & historically have punched above our weight because of quality over quantity produced by broadminded curiosity & a high social tolerance for thorny eccentrics developing in an ecosystem of high social trust & high standslards ofneducation & enquiry; so we should get back to that.

Good video, could you do an analysis on Czechia 🇨🇿 I’m interested what you have to say 😊

Both political parties have the same failing policies. High tax burden on entrepreneurs. IR35 crushing innovation and small startups.

As a software engineer, I am always surprised to learn about the pathetically low salaries in my profession in the UK. A London-based developer could be making one quarter of a similar Silicon Valley developer, and half of a Tel Aviv developer. Sometimes the salaries were even lower than in Ukraine before the war. That's despite the insane London real estate prices and generally high-ish cost of living. At the same time, unlike in Ukraine, developers are not well-paid compared to other UK professions, so the UK doesn't have many of them and cannot become an outsource location. This is just one symptom, but it shows a major issue in the UK: extremely high-productivity jobs are not rewarded.

means their style is no longer working

America is even sadder, most of our GDP doesn't even come from services but from consumption.

I think Brexit represented an opportunity for ambitious leaders to take the bull by the horns and make positive change for the UK but unfortunately there’s no sign of strong leadership thus validating the remain-ers.

Can we correlate anything between people piling investment into the buy-to-let property industry (for quick and easy returns) rather than investing in actual UK industries? I'm no economist, but investors taking the path of least resistance seems like a recipe for disaster down the line. I think reversing the financial appeal of investing in buy-to-let, or owning one, can only be helpful as a course corrector. With added benifits socially too. BTL landlords will hate this as they dont see the greater game theory in it. Thoughts?

The UK needs to integrate into NAFTA to become a conduit between the EU and North America again. Also, the dominance of the finance sector was horrible for regional inequality in the UK. Having a more diversified economy by focusing on manufacturing would be a good thing (even though the UK is unlikely to catch up to Germany anytime soon.) The UK has one of the EU’s strongest renewable energy potential due to the North Sea and Scotland’s wind. Further Public Investment would also help.

what do you mean? Everything is going great. Millionaires and billionaires are making money. Why would the government change? They are millionaires and billionaires.

Part renationalise the water, oil and gas companies. So 70% public government owned and part private owned. The money will go into a sovereign wealth fund to fund infrastructure. The UK needs to restart it's manufacturing sector and focus on solutions such as high tech industry, engineering, aerospace, defence etc. Improve trade links and deregulation. We are an island with virtually no fishing industry, good could be a quick improvement. Emphasis on local and regional infrastructure rather than national. Trade with the entire commonwealth as well as Europe with trade and services but also protectionism to protect British industry.

How come the United Kingdom, so democratic, tumbling down economically ？

Thank you!

UK productivity north south divide. People have to move to London for the best opportunities which has priced many people out.

1. Need Cheap Energy 2. Need property investments that are reasonably profitable, but not excessively so

We are STILL in austerity!!!! From 2007. 😮 They won't invest because it would provide a better life, they want to only manipulate you. Social class ceilings everywhere.

Might I put in a little history? In 1976 (I was there, then, by the way) a labourer's wage was £40/week or £2,000/year. Beer cost 10p per pint and small houses cost about £4,000 to £6,000. So the wage equalled 400 pints of beer and a house cost 2 or 3 times the annual wage. NOW (2024) beer costs £4 or £5 per pint; houses average £280,000 and wage.......£27,000 per year. So to equal 400 pints of beer, wages should be £1,600 to £2,000 PER WEEK (£83,200 to £104,000 per year) for a labourer or between £93,000 and £140,000 per year compared to a house. As they say: "You do the maths!" Please note that all the real figures above related to someone doing a basic labouring job, such as a Farm worker. Peace and best wishes, Luke

Lack of kids and aging population...this is the problem in all of Europe.

First problem is basic economic management and honesty. And it's not a left or right issue, it's a matter of integrity and long term thinking. We need to stop running deficits, if the Tories want lower taxes, they need to be honest and lower government spending until there's no deficit, if Labour want high government spending, they need to be honest and raise taxes until there's no more deficit etc. Similarly they need to stop lying with statistics, increasing GDP by importing a million immigrants a year isn't making people richer, but the government tricks people into thinking "the economy increase in size by 2.5% is the same as "we made you 2.5% better off. No, government should actually be required to tell people about GDP per capita or median GDP per capita, which proves that people aren't really better off at all, and would force the government to stop focusing on "make GDP go up" and instead focus on making Britain more efficient and productive.

😂😂😂, thought Rwanda refugees was their only problem, I hear about that daily, than their real problems affecting the country.

The Problem for GB severe greater because the Service Sector will be replaced by KI .

Small business support is zero, plus 100s of rules and strict regulations. You can only take a loan if you show that you have 10 times the amount. In other words that you don't need money.

40 years ago, all my art and design professors coming from UK (I'm from HK) were the best trained with best fundamentals. I had dreamt about going to school there to further my design education. What happened?

As an investing enthusiast, I often wonder how top level investors are able to become millionaires off investing. I do have a significant amount of capital that is required to start up but I have no idea what strategies and direction I need to approach to help me make decent returns

Brilliant insights.

Just adding my two cents - energy costs are also to high, it is difficult to make anything in the UK competitively

These videos are getting beyond stupid now, especially on topic of uk in last 2 years because they gain views internationally with apocalyptic titles with everything always being a crisis. Truth is, take out all the opinions and look at independent fact based statistics from imf, oecd, etc and uk is growing a tiny bit slower than France (f 0.7 uk 0.5) this year but then is projected to grow faster every single year until 2029 (f 1.4, 1.6, 1.5, 1.4 & 1.3) (uk 1.5, 1.7, 1.7, 1.6 & 1.4). Compared to Germany whose imf projections are from 2024 through 2029 0.2, 1.3, 1.5, 1.1, 0.8 & 0.9 the uk grows faster every single year. None of the three large European countries grow really well, but none are terribly far off the 2% growth per year and uk is probably the best of the 3 going by most recent projections. Gods knows there are things to fix but these absolutely ridiculous videos have gotten completely nonsensical at this point.

Speaking on the investment issue, I'm a brit that has started a few companies, most have failed, but one succeeded. The limiting factor? Purely investment and geographics. Previous companies were formed in the UK, and raising capital was damn near impossible. The requirements are far too high and appetite for risk far too low, so we setup in the US instead. Investment was more or less immediate and flush and I attribute that to a fundamental difference in culture & institutions. The UK's finance and investment sectors are far too risk averse to consider anything other than a safe bet, and as such have pushed myaelf and several others out of the country in search of greener pastures. It's a sad, sad state of affairs that the immense ingenuity and inventiveness back home is being squandered as a result of such backwards thinking. When everything is accelerating, the UK (and europe) seems hell bent on slamming the brakes.

Well I suppose one advantage of the service sector is that it's not quite as heavy on extortionate energy costs as the manufacturing sector. For those employed in the these hi-flying careers in the service sector they are probably going to be ok but what about everyone else? It seems that under this thesis you COULD have a thriving service sector in isolation from everything else going on in UK society. Lack of affordable homes to buy or rent and lack of affordable energy are huge problems aren't going away anytime soon which leads to what we have which is a TWO TIER society in which the hi-flyers get the nice homes and everyone else has appalling living conditions. This dystopia already exists in our capital with raging unpredictable often life threatening crime day and night, raging flag waving mobs every weekend , a few nice homes and housing conditions for the high flyers and terrible housing conditions for everyone else. This video is far too narrow and blinkered in scope for my taste and fails to address the wider problems that form the seeds of a revolution. We are already in the throes of some sort of revolution as it is although whether it remains one controlled by the hard left in the years ahead as does at present remains to be seen!

Short term improvements always lead to long term losses and the UK politicians always think short term.

we cannot afford houses, food, cars. and the wages dont go up with prices. i'm 18 and the generations before us commonly dont understand how everything isnt as affordable for us as it was for them - we cant afford a house in our 20s, we can barely afford our first car.

3:50 you sure that the labor productivity hasn't "lowered" because manufacturers have to work faster for more money because of inflation? as well as other sectors

Corruption and bad food are the reasons 👍

It's now the DK: Disunited Kingdom

don't wanna nit pick here but a century ago is after WW1 and after WW1 New York has replaced London as the economic center of the world.

Repeal the UK Climate Change Act 2008 - the world's longest suicide note for a developed economy. It's why UK puts off investors. Woke and green EU is also dying fast. Energy independency is key and cut back on Big Govt regs.

Uk is the second most unhappiest country in the world. No wonder with the governments we have had.

I am surprised nobody sees unelected rulers as the probelm. May be that's the problem or part of it... a rather BIG part of it 🤔

I'm more of the believe that the public seems to get dumber and think with emotions instead of logic and their heads. they seem to want more gratification and relief in the short term sacrificing the future. We need a shift in paradigm where we think towards the future and sacrifice today so we can live a more prosperous and stable society. Yes we should sacrifice today.

The last point about reforming the tax system to penalise consumption is one of the stupid ideas I’ve heard this month.

Maybe Brexit was a bad idea.

3:48 - 'Labor' productivity - WTF?! Not impressed.

You don’t get those trade deals.

UK was at its financial pinnacle when it avoided free market economics by protectionist measures for the Empire, and specifically for UK within the Empire. Thatcher began the move away from an economic system that benefited the nation to an ideological (contrary to evidence) neoliberal economy. That FLICKED us big time. 3:44 Labor? Pronounced Labb-or.

UK is relaying on demand from EU and China, it seems there is no way out for UK economy

I predict we are in the Weimar Republic, Starmers Labour will behave as the Social Democrats did in that time, and the consequences will be similar.

Thanks Thatcher

Now that all the loot money is over they are struggling

The politics of the UK just isn't changing. We are still having to choose between Labour and the Conservatives who are not running society for the many who make up the real economy. Just who or what is the real economy now? The UK has been "hijacked" for the wealthy and the rest are having to pay for their ridiculous greed. Running society simply to maximize wealth inequality is a massive problem not being addressed globally, including in the UK. Its got silly, the super-rich are simply rewarded for having wealth such that investing in the so called "real economy" doesn't even pay them. Its been made that ridiculous by politicians who are not interested in actual solutions that would actually make the world safer and better place for more of us, not less. For example, the conservatives and labour just continue to artificially inflate the land and property prices by not building "homes" which are now referred to as "assets" (e.g., this is why your high street is all boarded up and rents have increased). They continue to run a non-progressive tax system and centralize power and wealth, using this to leverage even more for the wealthy through quantitative easing and inflating deficit borrowing. The premium for everything including food continues to rise because of wealth inequality which politicians support growing. The politics of the UK just isn't changing. Joining the EU will only compound the problem, so that's no solution in truth, despite some people wanting to believe that it is. I say, lets have 20 years of progressive wealth distribution back to the many and then review the situation. Raid offshore holdings to address the debt we are having to pay for. Ban multi-millionaires when it gets to 3 million. Nationalize all super yachts. Don't let the wealthy claim the state pension as they don't need it. Make those with a property portfolio house at least 2 homeless people mandatory. Lets try 20 years of that, then review the situation 🙂

Get out, Australia has just had its 3rd federal budget surplus, it spends 15% more per person GDP.

No mention so far to UK investment in Property, this is the way to make money in Britain today

Look to small countries that have thrived and created wealth for all their citizens. Singapore got it right under strong visionary leadership from Lee Kwan Yew. Low taxes, incentives for entrepreneurs, a culture of rewards for hard work, and as the great man said " we want engineers and scientists, not fruit pickers". The socialist culture in the UK has sent the country into terminal decline.

Our environmental laws make industry impossible

The UK is dying and it's a situation of our own making. We voted the tories in and have continued to do so since 2010. We are the architects if our own downfall. Much like America and Trump. When you're given the option of a s#*t sandwich or a s#*t sandwich with mayo...you'll go with mayo coz it's easier to digest. Productivity is down because...frankly what's the point? You work 50+ hours a week to SURVIVE, not LIVE. How are you supposed to enjoy life? The UK's problems are vast and varied.

I would propose a major tax on hoarded wealth that funds public enterprise creation, jobs, and social return on investment.

It’s insane how obvious the solution to the issue is. Housing. How can there be innovation and productivity when everyone’s money is being flushed into an asset that only appreciates the less you allow other people to have/make. It’s sad and lazy. It’s Idiotic where we are at now and was so predictable and easy to see coming. The British public are too easy to fool hence we will remain a reliable battery funnelling money to mega wealthy as standards of living plummet through the floor. We have a situation where young people are saying “what’s the point in working when I’ll see nothing from it?”. I don’t agree with that mindset personally but I get it because what exactly is the benefit of working hard with the way things currently are? Burst the bubble for good. Until the country concedes that housing should not be for profit and allow disposable income to actually be used on things that will grow the economy we will be stuck.

Well a country only has so much capital, the import export deficit means our capital is decreasing. Then if you consider the capital (not equally) is split in slices amongst the population, now if that population increases drastically, then each slice gets smaller. Now if we consider that legal immigration is sat at 2.5 million just in the last 5 years alone. That's 2.5million more people taking their slice. Then add in illegal immigration, which is just a pure wasted cost that further contributes to the import export deficit, also the tax burden on the country so everyone's tax slice isn't fully paying for services they are meant to be. Then add in the wasted funds on extra policing and extra healthcare because more crime and less sanitation is the norm in less homogeneous places. Being brutally tight on immigration is really the only way actual British people will start earning money well above what the norm was in 2005.

Investment in high quality human capital...while I could quote numbers, I will quote examples. As mamy as 7 classmate of my son didn't take their GCSE and dropped out. Customer services staf, born an brought up here, would wrote 'there' for 'their'... When I decided to rejoin work afyer a long career break for looking after my special needs child, I was pressured to the point of chronic anxiety to take ANY job, rather than support me to finish my CFA which I took to restart my career. To govt, I'm just a number, and this number should rather be in 'employed' category than 'high skilled employed' one because the latter delays the employment numbers and govt can't afford that. Not to mention the so called training they provide is ' MS office skills'. Clearly, the system doesn't support high skills whether it's children or adults. How far can you go with just, or without, a University education leave alone without GCSE

Taxing consumption is an attack on the capitalist/ consumerist way of living that 🇬🇧 population is very used to living. If you tax consumption the whole economic & lifestyle of the population will be greatly adjusted. Maybe it’s what the people need. I just don’t think it’s what they would want though..

What about doing a free trade agreement with Canada, Australia, New Zealand and Ireland?

Up VAT to 25%, remove all other taxes, and then institute a 2.5% annual tax on all assets held outside primary residence and necessary vehicles. Simple as. The second corporation tax is gone, GDP surges for 10 years!

Isn't it ironic that people in "authoritarian" countries like China, Vietnam, Saudi Arabia, Singapore, are happier and more satisfied with their governments and countries directions than people in democracies who are apparently allowed to choose their countries futures.

The UK could dramatically reduce its energy costs by investment in tidal energy like la Rance in France, and onshore wind which is much cheaper than offshore wind, even though the conservatives prefer it!

Is it a good time to pay high tution fee and study in UK? Is the ROI good?

If only it was just the economy that was messed up here. No we have so many problems right now that I’m not sure this train wreck can ever be salvaged.

In the end Germany won anyway, despite everything.😂 Please comment an angry retort below:

Please trade with East Asia countries

If we can focus our efforts on practical sciences, and get lucky, then we might just make it.

Spiralling economic inequality is the main issue. It should be obvious.

Politicians focus on winning the next election. This means focusing on those who actually vote. Retirees. So there is little incentive to build the economy for the future.

Love the bow tie + bracers.

This is one of the reasons I left the UK

the EU doesnt want the UK back with them. whats the point?

and their's not a complete or a very conceivable

I know loads of people that simply don't work. They sit at home collecting benefits. The system enables this so I don't totally blame them!