The Observer view on the UK economy: Labour is holding back when it should be bold

Businesses up and down the country are trading without investing. Workers are leaving the labour market, citing health problems. The public sector remains shellshocked from more than a decade of austerity and a series of debilitating crises, the spike in inflation being the most recent. The growth enjoyed by the economy in the first six months of the year, which Sunak believed mistakenly would propel him back into No 10, was merely a bounce-back from the recession he can take part of the blame for creating in 2023. A glance back to last year shows that whopping personal tax rises, a refusal to acknowledge Brexit trade hold-ups and the sense of a government devoid of fresh ideas or hope, added to an already difficult situation and gave consumers and businesses all the excuse they needed to hunker down and stop spending. Nine months into 2024 and the best we can say about the economy is that it is stagnating. As inheritances go, it is a miserable one.