A road trip round the recession

So Britain is officially back in growth. Andy McSmith travels from London to Birmingham to find out whether the public's experiences correspond with the statistics
Click to follow
The Independent Online

"It makes you laugh when they say the recession's ended," remarks Dave Oakman, Catford's friendly family butcher, who was not laughing as he says it. "I talk to a lot of people who are running small businesses, and I don't know anyone who is really happy or chirpy."

This neighbourhood is about midway up London's prosperity stakes. It does not drip wealth, like Kensington, nor it is one of the desperate, unemployment-ridden parts of inner London. Most of the Catford traders who were there when the recession started are still in business, though they are not having an easy time.

To see how different parts of the country have faired during the recession – and whether the end is in sight – I travelled from London up the M40 to Britain's second city, Birmingham.

On the way we stopped in towns and villages, factories and guest houses and spoke to workers, businessmen and shop keepers.

Our trip suggests that there is a general rule about the recovery that has officially just begun – the better off you are, the more you are going to feel that things really are looking up.

In Catford, Mr Oakman, a small businessman who took over his butcher's shop just three years ago found the recession really hit home when one of his largest customers went bankrupt and he discovered that small traders who are owed money are way behind the banks and others in the queue of creditors. Mr Oakman's shop supplied meat to a privately run young offenders' institute which ran into financial trouble. Rather than bail it out, the government moved the inmates to other units and let the firm go under.

He was told that he may get 15p for every pound he was owed, though he has not seen any of it. What he has seen is a long document in which he noted that the lawyers handling the case were charging nearly £240 an hour. Their fee, totalling around £45,000, is not in danger of going unpaid. "I know industrial cleaners who have been knocked back twice because companies went bust owing them thousands, which nearly sent them under," he said. "I know builders who are having to rush all over the place because they've lost their Polish workers, who've gone back. Everybody in the private sector is holding on to their money more than they should. The best payers are the NHS and the council, because they're told to pay on time."

Thirty miles to the north-west lies High Wycombe, a reasonably prosperous southern English town for whom the recession has brought rising unemployment. The Jobcentre manager thinks that is now on the turn because fewer people have been coming to sign on. But the unemployed visiting the office – most of whom did not want to be identified – were unanimously of the opinion that there is no sign of improvement.

"There's nothing, absolutely nothing. I can't even get on the buildings sites," said Bob Spencer, a carpenter whose work dried up a year and a half ago. Jessica Leslie, who is 18 and left her £5.80 an hour job as a waitress because it was not enough to cover her rent, was at least cheered by the possibility that the recession is over. "Has it really ended?," she exclaimed. "Oh, thank God. I hope so, anyway. I need a job."

But even just a few miles north west in the tiny village of Ibstone, the picture is very different. There is a centuries-old inn here called the Fox Country Inn, which cannot rely on passing trade, because it is along a country road where a few vehicles an hour pass by. The village has about 100 houses, whose average price is around £1m, and early in the morning almost the whole of Ibstone's working population heads for offices in London. To survive, The Fox needs to induce high-paying customers to find their way to it.

Its 38-year-old proprietor, Saf Dad, the son of a Pakistani bus driver, bought the premises two years ago, and invested £1.4m in turning it into a modern open plan bar and restaurant and high-class 18 room hotel. He opened for business in May 2008, and five months later, saw business fall off a cliff. "Basically, we were giving away the hotel rooms. It was very hard for a year," he said. But, now, at last, the sort of people who were not prepared to risk throwing an expensive birthday party in a recession are back, spending money. Young couples who put off getting married in a recession are also making plans. "In 2009, we had only 24 wedding parties in the whole year. This year, we have had 28 firm bookings already, and we're on course to do 80," Mr Dad said.

But in Cowley, the Oxford suburb famous for making the Mini, members of the local working men's club reacted with derision to the idea that the recession was over. One lady with a pronounced Irish accent, who would not give her name, suggested that anyone who thinks that should "get out and look at the real world".

In Cowley, where there were once full-time jobs, there is now only shift work, for those who can get work at all, they said. The club has 1,100 members. Takings at the club bar to fell by as much as £3,000 a week.

"We lost about 25 per cent of our trade over the recession. It has not come back yet. We have just ended our year, so we're waiting to see what the end of year figures are like," said Ernie Bedlow, the club's 87-year-old secretary.

Further west, in Banbury, recession came with a light touch. This is a prosperous place, with a lively local economy and an inordinate number of estate agents; you can buy an attractive two- bedroom home for not much more than £200,000. Only one went out of business.

"The last year was very good for us, as if the recession was already over. House prices rose five to ten per cent," Dale Vickers, branch manager of Chancellors said. "They fell about 15 to 20 per cent at the start, so they are not quite back to where they were, but almost. Not many shops have closed in Banbury. We've got everything here that people want."

That evening we stopped in Stratford and even on a Monday night the restaurants were doing a brisk trade. Here, at the home of Shakespeare, the weak pound has brought in tourists from America and Europe. The next morning the tourist office was doing a brisk trade even at 9am.

An even happier story to tell was 12 miles away at the Old Bull pub in the village of Inkberrow. The landlord there, Mike McCarthy, is not expecting the end of recession to make any difference, because it never reached his premises in the first place. This is partly because Inkberrow is reputed to be the model for Ambridge, so the Old Bull is a draw for fans of The Archers, whatever the economic weather

"We have done very well through this recession," he said. "I do a lot of the stuff myself, so I decided to keep my food prices down. We get a lot of local trade. We also ride on the back of our association with The Archers, so in the summer we get people coming from far away. What they hope to see, I couldn't say. What they get to see is me, I'm afraid."

From that idyllic spot, it is barely a 20-mile drive north to Ladywood, in central Birmingham, which has the grim distinction of being the parliamentary seat with the highest unemployment rate in the country.

In the centre is a curious little factory located in a cul-de-sac, where they make whistles that are sold all over the world. Acme Whistles has been there since Victorian times. It made the whistles used by the crew of the Titanic. When the film came out in 1997, they consulted an ancient ledger, dug out the original tooling, and made 50 replica Titanic whistles, to test the market. Their first advertisement brought in 15,000 orders. They still sell 4,000 a month.

The firm's managing director, Simon Topman, is also chairman of the West Midlands Chambers of Commerce, and so has a good overview of manufacturing in a badly hit region. His assessment is not despairing, but not cheerful either.

In the Aston district near his factory, unemployment is at 38 per cent, and the population is very young. He wonders how many people are ever going to find jobs. "Manufacturing is still in the doldrums," he said. "More than half the firms in the region reported a slump in profits in the past 12 months, but on the other hand 62 per cent are optimistic that profits and sales will increase in 2010."

But these manufacturers are not planning to take on extra people. Most of the increase in employment in his region since 1997 has been in the public sector. "When the public sector starts to contract, as it must do because of the size of the deficit, a lot of those jobs will go away," he said. "There will be a recovery, but what I fear is that we are heading for a jobless recovery."

What is certain is that the economic landscape of Britain after this recession will be very different. The businesses likely to recover fastest are those selling non-necessities to people with money. People who could have spent money but held onto it because they were anxious about the future will now start indulging themselves. But the little business, trading on small profit margins, may not be so lucky, and the unemployed may never feel the warm breeze of recovery.

In short, whether the recession has ended or not rather depends on who you are.

The Independent voter panel's verdict

Adam Goldsmith, 32, musician from Finchley: "It is small growth but significant, because people will feel confident enough to spend again. Gordon Brown will be congratulated. But, as the former Chancellor, he had a hand in getting us there in the first place, so I will not be voting Labour."

Michael Wager, 25, customer services consultant, Cheltenham: "Gordon Brown said we would come out of the recession slowly, ensuring long-term security, and I agree with his handling of things. The Conservatives would cut public services. Everything Cameron says sounds like PR."

Kay Wilkinson, 34, a mother from Pendle: "It's hard to believe the recession can be over just like that. My sister's husband lost his job recently, so she can no longer be a stay-at-home mum. Gordon Brown looks flustered and there is rebellion in the ranks, so I am still not sure who I will vote for."

Margie Arts, 67, former lollypop lady, Barrow-in-Furness: "Gordon Brown is just massaging the figures, but Mr Cameron is plastic and I don't think he will help. In Barrow, the Conservatives want to limit the time pensioners can travel on buses. How could you vote for them when they are doing that?"