Leaner Futures

Over the last two decades the poor economic performance of many Western nations has already resulted in people facing a decline in average disposable income and a consequent reduction in their standard of living. In the UK and the USA the global financial crisis impacted house prices leading to a further reduction in personal wealth by over $700 billion and $9 trillion respectively (Anon, 2012a). Even more pain can be expected in the future as governments seek ways of reducing excessive public sector deficits. Activities associated with rebuilding national balance sheets will result in many people having to pay more taxes and concurrently self fund services which in the past were available through a now rapidly contracting welfare state. Ultimately a nation’s economic revival is determined by the export performance, which in turn increases the spending power of the populations. Unfortunately few Western nations can expect any near-term significant growth in total exports. This is because any gains in sales to the emerging nations will be offset by poorer demand in domestic markets and overseas markets in Europe and North America.