HC Deb 11 June 1982 vol 25 c173W
Mr. Ernie Ross

asked the Chancellor of the Exchequer what is his estimate of the loss of output upon the gross domestic product due to the increase in unemployment since May 1979.

Mr. Brittan

The fall in output between May 1979 and mid-1981 was the result of many factors, including external developments in the world economy, our relative competitiveness in domestic and export markets, the rate of price and wage inflation and the profitability of United Kingdom industry. The rise in unemployment should be seen as a consequence of this fall in output rather than a cause. Since mid-1981 we have seen the first signs of a recovery in output and a marked reduction in the monthly rate of increase in unemployment. Of course, if workers accepted more realistic pay settlements and industry could produce goods and services more competitively, then unemployment would be lower and output higher.