The Last Two Years
In early 2020 the world went into lockdown over Covid and it was a steep learning curve for many businesses about the importance of digital marketing and online tools. The global economy also suffered with supply issues which were exacerbated in the UK by Brexit measures and other issues.
54% Energy Price Rise
In April 2022 energy prices increased by 54% in the UK for 22 million customers reaching
a 30 year high. Due to oil and gas price rises worldwide, with many households facing a £700 annual increase, these are worrying times. Energy prices are
predicted to rise as much as 50% across the whole world.
War in Europe
The war in Ukraine has been a main cause of the energy price rises with Russia as a major gas and oil provider. Also, the war has caused grain shortages which is driving food prices upwards and contributing to the economic downturn.
Inflation
Inflation reached a 40 year high of
9.1% in May 2022 in the UK and is predicted to rise as high as 11% in 2023. Energy prices and inflation are rising around the globe partly due to a decrease in global consumption during the Covid lockdowns.
Mortgages Rates Rise
Recent reports
in the UK media have revealed that house buyers will need a 37% pay rise on average to get a mortgage, which means a salary rise of approximately £15,000 or £29,000 in London. This could put a mortgage beyond the reach of most people. Also, the Bank of England is warning of a recession and further rises in interest rates, so the future is bleak for home buyers.
Innovation in Crisis
In tough times, the tendency for many businesses is to tighten their belts, spend less and weather the storm. However, entrepreneurs often innovate and invest more in times of crisis to gain a larger market share. See this McKinsey 2009 example:
“In past crises, companies that invested in innovation delivered superior growth and performance postcrisis. Organisations that maintained their innovation focus through the 2009 financial crisis, for example, emerged stronger, outperforming the market average by more than 30 percent and continuing to deliver accelerated growth over the subsequent three to five years.”
Source: McKinsey.com, June 2020
