Events in the UK economy over the last couple of years can be interpreted in a number ways. The predominant view, understandably, is that the credit crunch has ushered in a new period of austerity, which will affect us all if it hasn’t already. A double dip recession now appears likely, and our economic future remains uncertain.
Of course, none of this is new information. The economic cycle moves in peaks and troughs, and you don’t need a PhD in hindsight to know that the last economic boom was unsustainable. But the facts and figures only tell one side of the story. There’s an important piece of the picture missing here, and that’s all to do with how we feel about what’s happened.
For many, the impact of the credit crunch hasn’t really sunk in yet. People are still spending, still using their credit cards, and carrying on largely as if nothing has happened. But why haven’t they changed their habits and reined in their spending? It appears that people have in been in denial about the credit crunch and its effects. That’s an understandable response. When big things happen we often bury our heads in the sand for a while – that’s “normal”, although two years of it might seem a little excessive.
More recently, strikes and student demonstrations have shown that another mood is beginning to take hold. People are starting to get angry, and some of them are doing something about it. Regardless of your view on the appropriateness of this response, there is potentially a wider picture here.
Denial, followed by anger, are the first two stages of the grief cycle. Those of us who have experienced bereavement may be familiar with the other three stages; negotiation, depression and finally acceptance. For those who are interested, there is a rather good episode of House MD where House tracks the grief cycle in Doctor Cameron, who goes through it on behalf of one of her patients. (If anyone has any details as to which episode this is, or knows a youtube link to it, please let me know!) All of which begs a rather obvious question:
Let’s assume this is happening. So what?
The answer is in two parts:
- In the short term, if we know what the prevailing mood is, we can perhaps be a little more forgiving of ourselves and others when we observe it. By not taking it personally we are less likely to overreact and prolong the situation.
- In the medium to long term, if we know that this period of anger will be followed by negotiation, depression and acceptance, we are in a position to anticipate the prevailing mood, prepare for it, and help our clients through it. This could be source of competitive advantage, or it could be simply about doing the right thing.
In the meantime, thankfully, we have a royal wedding and the Olympics to look forward to. It will be interesting to see how much, as a nation, we get into the spirit of these events. There is also an expectation that these things will help to stimulate the economy through tourism and related expenditure. Let’s hope so.
A cynic might argue that that’s all well and good, but what happens after that? Er … who knows? Maybe it depends on where we are in the grief cycle. Maybe by then the government’s much publicised happiness survey http://www.bbc.co.uk/news/uk-politics-11837785 will produce some helpful results that will make a difference. Or maybe that’s too far down the track to worry about.
Our view? Keep an eye to the future, but remember to stay in the moment – after all, that’s where the action is.