The economic system of England
The United Kingdom has one of the most powerful and largest economies in the world. Rapid growth and expansion of the United Kingdom’s economy started during the industrialization era in the 18th century when the country witness widespread development of industries and mass production of industrial goods. The economy later diversified into several other sectors. According to the Economic Watch, United Kingdom is also endowed with several natural resources among them petroleum, coal, natural gas, iron ore, tin salt, limestone, chalk, gypsum, clay, silica and lead. In fact, it is the resources that made England to easily adapt to the industrial revolution, and sustain it prosperity. Currently the United Kingdom’s economy is a mixed economy where both the private sector and public sector alongside in put form the government contribute new economic growth and diversification.
Despite the dominance of industrialization in the nation, the service sector has strongly emerged within the county. In this sector, tourism is the main economic activities undertake on a large scale by the country. Every year, the tourism industry attracts millions of tourists from around the world. According to Deloitte, in 2009 tourism was £115.4bn worth to UK’s economy. This was a total combination of direct and indirect contribution of tourism to the economy. Direct contribution was £52bn, and indirect contribution stood at £63bn. It is also projected that between 2010 and 2020 the tourism industry will create a total of 250, 500 new jobs (Deloitte). Currently it is estimated that one in every six jobs is either directly or indirectly supported by the visitor industry. The other players in the service industry include banking, insurance and business services. In the modern world’s globalised economy, the country’s capital London is regarded as the globes largest financial center. In 2009, it accounted for 45% of the Gross Value Added (GVA) of the countries finical services (Maer & Broughton). It is also the world’s powerful trading center. The entire service industry is the heart beat of the economy. The financial service characterized by the banks and the insurance made combined contribution of £ 124.5 billion to the countries Gross Value Added (GVA) in 2011 (Maer & Broughton). The financial sector accounts for over 3.6% direct jobs and several other surpluses through surplus services. The banking sector is the most powerful of the financial service providers. Between 2010 and 2011, it accounted for £21 billion, through income tax, corporate tax as well as national insurance, to UK tax (Maer & Broughton).
The government has been pursuing policy seeking to reduce public ownership. According to EUBusiness, the program has been pursed for the past three decades and the country is concentrating as managing social welfare. The reduction was pursued to increase the rater of private participation, which has raised the level of mixed economy possessed by UK.
In UK Agriculture is practiced intensively and it is highly mechanized. Compared to the European standards, it is remarkably efficient and serves about 60% of the country’s food needs with less than 2% of the country’s labor force (EUBusiness). The main agriculture products include vegetable, beef, mutton, cereals, poultry, potatoes oilseed and fish (“United Kingdom Economy Profile 2013”). Despite the near food sufficiency state, the countries natural resources are declining at a high rate. Most it is the energy resources gas and oil that are on a steep decline. In fact, bet 2005 the country had become a net energy importer (“United Kingdom Economy Profile 2013”).
At the moment, the United Kingdom is third largest economy in Europe. In 2012,, the country’s GDP precipitate was estimated to be $37, 100 and had a growth rate of 0.8%-1.8% (“United Kingdom Economy Profile 2013”). The GDP consumption stood at 0.7%, 21.1% and 78.2% for agriculture, industry and services respectively. These sectors respective employment rates accounted for 1.4%, 18.2% and 80.4% of the workforce respectively in 2006 when the country had a 14% of its population below the poverty line (“United Kingdom Economy Profile 2013”). In 2012, the unemployment rate stood at 7.8% while the inflation rate stood at 2.8%.
In conclusion, England is a strong mixed economy, which enjoys the benefits of the participation of bother the public and the private sector. The country was the first to undergo industrialization but has since shifted to service industry. Main payers in the service instructor include tourism, banking, insurance and service for businesses. The country has natural resource, but they are declining at a high rate. Agriculture is a rather small sector in the country but generate about 60% of the food consumed in the country. In general, the economy is vibrant.
“United Kingdom Economy Profile 2013.” Index Mundi. February 21, 2013. Web. 31 March 2013 <http://www.indexmundi.com/united_kingdom/economy_profile.html>
Deloitte. “The economic contribution of the Visitor Economy: UK and the nations.” June 2010. Web. 31 March 2013. <http://www.visitbritain.org/Images/Economic%20case%20for%20the%20Visitor%20Economy%20-%20Phase%202%20-%2026%20July%202010%20-%20FINAL_tcm29-14561.pdf>
Economy Watch Content. “England Economy” 15 March 2010. Web. 31 March 2013 <http://www.economywatch.com/world_economy/england/>
EUBusiness. “United Kingdom: country overview.” EUBusiness 12 February 2013. Web 31 March 2013 <http://www.eubusiness.com/europe/uk>
Maer, Lucinda., & Broughton, Nida. “Financial Services: Contribution to UK Economy.” Economic Statistics 21 August 2012. Web. 31 March 2013 < http://www.parliament.uk/Templates/BriefingPapers/Pages/BPPdfDownload.aspx?bp-id=sn06193>