The Conservative party has suffered some severe electoral setbacks over the years, but this week's could be even worse.

If the polls are accurate, which they have been since the campaign began, the Tories will perform considerably worse than in 1906, when they last did poorly. A rerun of Thursday's results, which the Conservatives and their Liberal Unionist partners won with just 156 seats, would now be regarded as a success.

But in 1906, Arthur Balfour’s outgoing government secured more than 43% of the vote, while Rishi Sunak is polling at about half that level. And Balfour’s defeat could at least be attributed to a policy issue – free trade versus protectionism. Today, voters just seem sick of the Tories.

News on the economy since the election was called has had little or no impact on the polls. In part, that’s because the signals have been mixed: inflation fell back to its 2% target and growth in the first quarter of 2024 has been revised up, but the economy stagnated in April and unemployment has increased.

Living standards are certainly improving. The Resolution Foundation thinktank calculates that real per capita household disposable income – a guide to whether people are getting better off after inflation is taken into account – rose by 2.4% over the past year.

That’s the good news. The bad news is that over the 2019-24 parliament as a whole, living standards fell by 0.6% and one of the unwritten rules of political economy is that governments don’t remain popular when voters are getting poorer.

Only twice in the past century have living standards been lower at the end of a parliament than when it commenced: in 1918-22, when the UK suffered from a post-first world war boom-bust, and in the short parliament of 1950-51, when inflation rose sharply as a result of the rearmament programme for the Korean war.

In the inevitable postmortem examination that will follow the election, attention will focus on whether the Tories might have done better had Sunak delayed the election so that in time more voters would have come to think an economic corner genuinely had been turned. Another quarter or two of rising living standards would not have saved the Conservatives from defeat but it would probably have limited the scale of it.

As it is, Rachel Reeves will be the beneficiary. Analysts have been revising up their growth estimates for 2024 and 2025 on the basis that consumers will start to run down the precautionary savings they accumulated during the cost of living crisis.

Other recent developments – especially those overseas – are not so welcome. Joe Biden’s poor performance in his head to head debate with Donald Trump has made it more likely that the latter will win the US presidential election. Tariffs will be raised and taxes will be cut if that happens, threatening higher inflation and rising debt.

Meanwhile, the first round of voting in France’s parliamentary election looks set to show sizeable gains for Marine Le Pen’s rightwing National Rally party and a defeat for Emmanuel Macron’s centrist government.

Events in both the US and France highlight how things have changed in the near decade and a half since Labour was last in power.

Most obviously, the world has become a less safe place. The war between Ukraine and Russia is now well into its third year and has shattered the notion that permanent peace can be guaranteed for western developed nations. There are always demands for Labour governments to spend more on the NHS and on the welfare state. This time there will also be pressure to raise defence spending.

Globalisation has gone into retreat. Weak growth since the financial crisis of 2008-09 has seen a marked increase in protectionist measures – not just on goods but on people too. In Europe, North America and Australasia alike there have been demands for governments to restrict the number of foreign nationals entering the country.

What’s more, multilateral bodies are for the most part weaker than they were in 2010. The increasingly fractious relationship between the US and China means the G20 group of leading developed and developing nations cannot agree on much. The World Trade Organization is a much-diminished institution, unable to fulfil either of its core functions: to negotiate multilateral trade deals and be the final arbiter in trade disputes. The EU is having to contend with rising nationalist sentiment, a function of feeble economic performance and a reaction against rule by unelected technocrats.

The developing world has been even harder hit by Covid and the cost of living crisis than the rich west, increasing the incentive for migrants to look for a better life elsewhere. Yet aid budgets have been cut and promises to help poor countries cope with the impact of climate change have not been fulfilled. The world is getting hotter and the International Monetary Fund and the World Bank urgently need more money to meet demands for their assistance.

So those are the sort of challenges that Labour will face when it takes office later this week. Not the world of 1997, when Russia was seen as an ally rather than a strategic threat. Not the middle of the Great Moderation – the period between the fall of communism and the global financial crisis – when the west enjoyed year after year of growth and low inflation, but rather a world still trying to claw its way out of the Great Stagnation of the past 15 years.

And an angrier world where voters can quickly turn on their governments. Labour should enjoy its honeymoon period. It might not last long.