Professor Peter Urwin, Professor of Applied Economics, wrote an article for Business Leader about the financial impacts of the coronavirus pandemic in relation to the extension of the job retention scheme.
In the article, Professor Urwin discusses the financial impacts of the coronavirus pandemic, including higher government spending through the job retention scheme, which was recently extended. He wrote: “Spend too little now, and the economic scars will be with us for years, and unemployment destroys skills, viable companies go bust and investment stagnates.
“Spend too much, and the debt burden could usher in another age of austerity, with over 10% of tax receipts used simply to service debt.”
He also wrote about how we must understand how we will recover, and wrote: “Key to pulling off this balancing act is an understanding of what the path to recovery will look like – a fast-growing economy can carry more debt, just as higher income allows you to borrow.
“It is becoming apparent that the pandemic will have substantial, rather than transitory impacts – this implies higher spending, but I argue that future growth rates will allow us to more easily carry higher levels of debt.”