Coast Amalfi, Italy, Photo: Profimedia Images
The United Kingdom has lost its advantage over Italy and has remained in France in the last decade, it shows the figures of GDP per capita, quoted by the Greek Money Review. The underperformation of the British economy is determined by population growth, high inflation and low economic growth.
These findings are worrying for Keir Starmer's government, which analyzes GDP per capita, rather than the total production of the economy, as part of his promise to improve the standard of living.
The GDP per capita stagnated last year, when the Labor Party took power, and decreased in 2023.
As a result of this, even Italy, a country that has long been a symbol of economic stagnation in Europe, has almost completely reduced its gap to the United Kingdom, of $ 4,000 per capita as it was before the Brexit referendum in 2016.
At that time, the United Kingdom was approximately equal to France, according to the figures of the International Monetary Fund based on the parity of the purchasing power. Today, with a GDP per capita of $ 54,556, the United Kingdom is shoulder with Italy and almost $ 1,700 behind France, notes Bloomberg.
“The recent convergence between the United Kingdom and Italy has been quite impressive and it seems to be the result of the Under -performance of the United Kingdom than to improve the situation of Italy,” says Andrew Goodwin, an economist at Oxford Economics. “I suspect that this type of convergence passes a little unobserved, because we tend to look at the GDP in absolute terms, and this tells a very different story from the statistics per capita, because the demography of the United Kingdom and Italy are very different.”
In the last decade, the Economy of the United Kingdom has passed from one crisis to another, the 2016 referendum on the exit of the European Union being followed by pandemic and then by the inflationary crisis, where prices in the UK have increased more than in France and Italy.
During the same period, the country experienced a significant growth of the population, due to record immigration, but failed to accelerate its productivity.
The population of the United Kingdom increased by about 5% between 2015 and 2023, the official figures showing that 1 million people were added during this period. Today, immigration becomes a major concern for British voters, increasing the support for Nigel Farage's Reform Party.
Among the five largest European economies, only Germany has registered smaller GDP increases per capita in terms of purchasing power than the UK in 2015. Of course, Germany remains the richest country after this measure. The United Kingdom registered an increase of 5% during this period, compared to 13% in Italy and 4% in Germany.
The UK has surpassed Italy in terms of GDP growth per capita most of 2010, when the debt crisis hit the euro area economies. However, the economy of Italy had a better evolution during the pandemic and was also stronger in the post-pandemic years, reducing the gap to almost zero.
According to George Buckley, an economist at Nomura, this situation may partially be due to the fact that more and more immigrants go to the UK not in order to find a job, but for studies or to accompany their family members.
