There is still hope..... but just a glimmer!

Well the dust has settled a little after a chaotic couple of weeks in UK politics, swine flu didn't wipe us out, the local elections didn't see the end of Brown and the European election highlighted the fact that people don't really care and there is a small but disgraceful bunch of far right fascists. Oh and the small matter of a few expenses claims.

The results have been pretty damaging for Labour, no wins or holds in local elections and dropped to 3rd in the European elections (5th in South East and West). There is still a glimmer of hope for Labour though.

Clinton famously coined the phrase 'It's the economy, stupid' and that is the only glimmer of hope left. The Labour heartlands are what Mr Brown most focus on if he has any chance of winning the election. Losing seats in the local elections in places like Lancashire, Staffordshire and Derbyshire must be reversed. There is a belt of the country from Liverpool to Hull that will decide where the election goes too. It is unsurprising therefore to see that one of the major problems in this area is unemployment. The bbc has a map that I'm sure many of you have seen and highlights the problem at heart. Therefore, if the economy picks up in theory job creation will increase and thus Labour can hold on to these areas. A similar tale can be said for South Wales and Birmingham.

Nothing I'm saying is rocket science really and there is a difference between saying it and doing it. There are small signs though that the worst is over. Lloyds have given back £2.3bn, Northern Rock have already repaid half of it government debt and the stock market has stabalised. Even the pound is gaining strength. If this continues (this is a big 'if') then job creation should start with a bit of a lag.

There is some obvious problems with this theory, firstly, unemployment rises quicker than it lowers. Companies can use the recession as an excuse to sack more staff than it really needs to because it is hard to sack people in 'normal times'. The UK also has a structural problem in the fact it's not very competitive as a labour market.
I don't want to go on and on but if the econmy does pick up and people see the difference then everything else will be forgotten and Labour will be reelected.