UK heading for first double-dip recession since 1975 Unemployment is already at a 17-year high of 2.68m, or 8.4pc. Confirmation that the British economy is shrinking for the first time since the weather-affected 0.5pc contraction in the final quarter of 2010 sparked a rash of warnings of a second recession. George Buckley, UK chief economist at Deutsche Bank, noted that a double-dip would be the first since 1975. He added that the UK is facing seven lost years, with the economy still 3.8pc below its early 2008 peak and the recovery on course to be the slowest in over a century. He said: "If the recovery continued at this pace, then it would take until the end of 2014 before GDP reached its peak again." Shadow Chancellor Ed Balls said the collapse in growth was "a damning indictment of George Osborne's failed economic plan." Mr Osborne refused to budge on austerity, though, blaming the eurozone. "These are disappointing figures but they are not entirely unexpected," he said. We have got the right plan, we have got to stick to it but we have got to accept that Britain's problems have been made worse by the situation in the eurozone. While the Treasury intends to stick to its guns, the Bank indicated it is planning more quantitative easing (QE) next month. Minutes from the Bank's rate setting meeting said: "For some members, the risks of undershooting the [inflation] target meant that a further expansion of asset purchases was likely to be required." The Bank has already injected £275bn into the economy through QE. Economists expect another £50bn to £75bn in a fortnight's time. According to the ONS, manufacturers bore the brunt of the quarterly slump, declining 0.9pc - the steepest fall since the start of the recession in 2008. However, some hope was offered by an improvement in the CBI industrial trends survey for January. Although orders remained below normal, economists said the data suggested the deterioration in the industrial sector had "troughed."