Compared to the pre-crisis year (2007) we still have to recover 4,2 percentage points of GDP and 19,2 points of investments. Furthermore, after 10 years, household consumption is 1,9 points lower and disposable income, again for households, is down by 6,8. In terms of employment, employment increased by 1,7 percent, while the unemployment rate rose by 84,4 percent. If, in fact, in 2007 the rate of those who were looking for a job stood at 6,1 per cent, in 2018 it rose to 10,5 per cent (still unofficial). On the other hand, exports are good: after a decade, sales abroad grew by 13,9 per cent.
To make this check on the state of health of the economy of our country 10 years after the beginning of the most dramatic economic crisis of the last 70 years was the CGIA. The coordinator of the Paolo Zabeo Studies Office says:
"Although in the last 5 years the GDP has returned to growth, the result is fairly clear: compared to the pre-crisis year we are less rich, investments have declined, we spend less and we are more unemployed. The only really positive thing is that our "made in Italy" flies and continues to conquer foreign markets. According to the growth forecasts that in the three years will be well below the annual 1 per year, most probably our country will recover the 4 points of GDP lost from 2007 not before 2024: practically 17 years later".
The wealth produced and the situation of families
Compared to 10 years ago, we have 4,2 points of GDP less, largely attributable to the collapse of public / private investments and the decrease in household consumption. Recall that the latter constitute about 60 percent of the entire wealth produced by the country each year. Obviously, the contraction in consumption is attributable to the increase in the unemployed (only to a small extent offset by the increase in employment), which has considerably reduced the availability of household income, especially in the South.
The Secretary of the CGIA, Renato Mason, points out:
"It is true that the effects of the economic crisis have been so heavy and, therefore, it is very problematic to make this comparison between the 2007 and the 2018. However, it is useful to give some elements to the public opinion to learn, in numbers, the difficulties of the moment and the areas where our economy still has delays that must be absolutely recovered by putting in place adequate economic measures.".
A still weak labor market
In 2018 the number of employees in Italy (23,3 million) exceeded the level we had in 2007 (22,9 million). However, the number of hours worked has collapsed. Between 2007 and 2017 (the last year in which the data is available) the total number of hours fell to 43,2 billion (- 6,1 per cent which in absolute terms are equivalent to - 2,7 billion
hours).
In the first 9 months of the 2018, compared to the same period of the 2007, we have recovered 338 millions of hours. A further demonstration that we struggle to reduce the gap with the threshold that we recorded in the year before the crisis.
And although we have recovered and exceeded the number of employees we had in the 2007, the economic crisis we have experienced in the last 10 years has significantly increased the number of employees with fixed-term contracts (+ 22,4 per cent compared to 2007). In other words we are increasingly precarious.
The 2019 forecasts
Following the slowdown in the world economy, the still very uncertain effects of Brexit and the cessation of Quantitative easing on December 31st, it has never been so difficult to predict how the Italian economy will go like this year. According to our calculations based on Prometeia data of October 2018, GDP should grow by 0,8 percent, thanks, in particular, to the 1,9 percent increase in investments, +1,1 percent in consumption of households which should bring unemployment down by 0,2 per cent and increase in employment by 0,4. With fewer unemployed and a little more employed, household income is set to rise by 1,5 percent. Although slowing down, exports will increase by 2,9 percent, demonstrating that our productions continue to be appreciated by international markets.
Finally, it cannot be excluded that if GDP growth were to be much lower than the +1 percent estimated by the Conte government, the Conte government will have to approve a corrective action already before the summer. Indeed, major international and national bodies are revising growth estimates downwards as the European economy is slowing down. With a GDP lower than that envisaged in the 2019 Budget Law, the deficit / GDP ratio would end up being higher than the 2,04 percent "imposed" on us by Brussels. A scenario that, of course, is to be avoided, given that by the end of this year it will be necessary to find 23 billion euros to avoid the VAT increase which, otherwise, will start from 1 January 2020. Finally, it should be noted that with 2019 GDP growth clearly less than 1 percent, no other country, as the European Commission (European Economic Forecast, institutional paper 089, November 2018) has reported, will do worse than us, again this year.