UK Economy Languishing: Living Standards Stagnate

by Victoria Sterling -Business Editor January 19, 2026

written by Victoria Sterling -Business Editor January 19, 2026

Monday 19 January 2026 6:32 am

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UK economy ⁢languishing behind peers as living standards stagnate – CityAM

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The Labor government risks leaving the⁢ UK economy falling⁤ further behind major trading partners, left-leaning economists have warned, as ‌they urged Rachel Reeves too⁤ ramp up growth plans ahead of crucial⁢ meetings in‌ Davos this week.

A new report by the Resolution Foundation, the think tank where several current ⁤Treasury ministers brainstormed policies before becoming MPs, has hit out at⁣ the stagnation in ⁣living standards across⁤ the country.

In a warning to Reeves, economists said‍ the UK was “languishing” 15 per cent behind the ⁢likes of Germany, France‍ and Canada in GDP per head.

The report bemoaned⁣ the government’s indecisiveness, claiming policy uncertainty had been greater over ⁤the course ⁢of this parliament ‌”than any of the previous seven” Conservative governments.

The lack of ⁤progress on planning reform and boldness on ⁤trade were highlighted as key areas where government policymaking ‍has fallen short of ‍expectations among researchers at the think⁣ tank.

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Victoria Sterling -Business Editor

Victoria Sterling brings over 15 years of financial journalism expertise to NewsDirectory3. Her specialties include market analysis, corporate governance, mergers & acquisitions, and economic policy.