George Osborne's big economic experiment is failing

When George Osborne first became Chancellor in 2010, he had a clear plan to “rebalance” Britain’s economy.

His “New Economic Model”, set out in the 2010
Mais lecture, involved lessening dependence on the City and other service sector industries and instead increasing the contribution of the likes of manufacturing and construction. That way, if a new banking crisis were around the corner, it would not deal the country such a big blow.

But, in the 5 years since, Osborne has well and truly failed to do any rebalancing, as the chart of GDP growth components from the Office for National Statistics below shows.

The service sector’s contribution to growth — the red dotted line — has steamed ahead, while other industries struggle to find a groove or growth.

NOW WATCH: JIM CRAMER: ‘YOU SHOW UP AND THAT’S THE REVENGE’

NOW WATCH: Money & Markets videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.