LONDON (Reuters) – One in five people in Britain fear an economic depression because of the impact of coronavirus and a further 52% expect the country’s economy to be in recession within a year, a poll by YouGov showed on Monday.
“Almost three quarters expect that Britain’s economy will be in depression (19%) or recession (52%) within a year,” YouGov said in a news release.
Twenty-eight percent of respondents said the economy would be growing in a year’s time and 1% said it would be booming, according to the poll which was based on responses between March 1 and 18, before the government toughened its shutdown measures last week to slow the spread of coronavirus.
Economists have predicted a severe hit to the economy in the coming months and say the chance of a recovery later in 2020 depends on the duration of the pandemic and the shutdown.
Finance minister Rishi Sunak has sought to slow an expected jump in unemployment with a string of emergency measures including a pledge for the British state to pay 80% of the wages of workers who are temporarily laid off but remain on companies’ books.
The Bank of England has cut interest rates to a record low 0.1%, ramped up its bond-buying programme and is seeking to ensure firms can borrow money to see them through the crisis.
YouGov said its monthly measure of how households feel about their finances showed its biggest ever monthly drop and consumer confidence fell by most since immediately after the Brexit referendum in 2016.
A separate survey published on Monday also showed a fall in consumer confidence in Britain in March although by less than in some other countries where governments were quicker to order lockdowns.
The European Commission said its monthly survey showed consumer confidence in Britain fell by 3.5 points to 92.0, compared with a fall of nearly nine points across the euro zone.
Samuel Tombs, an economist with Pantheon Macroeconomics, said the almost seven-year low touched by Italy’s economic sentiment index — a broader measure of confidence, which includes businesses — was probably a better guide to sentiment in Britain now.
“Accordingly, we feel under no pressure to alter our forecast that GDP is on course for a 1.5% quarter-on-quarter drop in Q1, followed by a huge decline of about 13% in Q2,” he wrote in a note to clients.