Surprise figures released by the Office of National Statistics last week revealed that the UK economy had contracted for the sixth consecutive quarter, meaning it is one quarter longer than the recessions of the early 1980s and 1990-91, and the longest since quarterly statistics were first recorded in 1955.
Following the 0.4% decline, the economy has contracted by a total of 5.9%, just shy of the 6% contraction experienced in the early 80s, the deepest recession since the Depression.
According Begbies Traynor, rather than on the verge of recovery, the UK could be in the "eye of the storm".
Begbies Traynor, which compiles the Red Flag index of companies facing financial difficulties, is predicting a "W" shaped recession, with a "deluge" of business failures set to occur in 2010.
In the recession of the 1980s, the rate of GDP contraction slowed significantly mid way through, only to contract deeper in the following two quarters.
Experience from previous recessions suggests that insolvencies peak between one and two years after GDP stops shrinking. However, the lack of available credit is set to intensify this effect causing a substantial rise in insolvencies during 2010 and into 2011.
Mark Halstead, Red Flag director at Begbies Traynor, said that the economy was "grinding to a halt" as companies were unable to access credit.
"We need a big bang effect where banks start lending again. It will happen, it is just a question of when," he said.
Speaking in today's PrintWeek, print and packaging specialist Nicholas Mockett of advisory boutique Moorgate Capital said that it was difficult to see what would pull the economy out of recession.
"The next government will have to address public spending and tax measures which will have a downward pressure on the economy."
The print industry has been hit particularly hard by the recession. According to PrintWeek research, at least 60 print companies with a turnover of more than £2m have collapsed since the start of the year.
The pace of those collapses has slowed since the height of the recession where 12 such companies called in the administrators in June.
Evidence of a recovery of sorts is backed up by the latest Red Flag statistics which found a 24% decline in the number of companies facing "critical" problems and an 18% in those facing significant problems in the third quarter of the year, compared with Q2.
Marcus Clifford, managing partner of BPIF McInnes Corporate Finance said: "Printers have now aligned their costs but revenues are still a challenge and confidence needs to return to the economy."
This sentiment is echoed in reports from printers. Simon Summers, managing director of Delta Display, part of the Delta Group, said: "We have been quite fortunate throughout this period and while we have seen the downturn, we have compensated for that with new business.
"Despite some people believing there have been green shoots, we haven't seen that. It's likely that this will be the case until the second quarter of next year."
Meanwhile, Albert Kampta, sales director at Newnorth Print, said: "Things are going alright for us in the current climate, and there is a steady flow of work coming in.
"I wouldn't say there is much of an upturn as yet, but things haven't got any worse. We are still winning new accounts, so it's more a case of just getting the work done."
