11 March 2014

Economy set to exceed pre-recession level

Good news for businesses! The UK economy is set to grow past the level it was before the 2008 financial crisis, the British Chambers of Commerce says.

The UK economy is set to grow past the level it was before the financial crisis hit in 2008, according to a business lobby group.

The British Chambers of Commerce (BCC) estimates that GDP will reach a record level in the second quarter of this year, surpassing the level it was at the beginning of 2008. The organisation predicts economic growth will be 2.8% this year, which is good news for businesses all over Britain and 0.1% higher than was originally estimated.

BCC Director General John Longworth says:

Our economic recovery is gaining momentum. Businesses across the UK are expanding and creating jobs, and our increasingly sunny predictions for growth are a testament to their drive and ambition.

In December, the BCC had thought economic growth would reach pre-recession levels this autumn but things have been improving so well this is now expected during spring. It has also increased its growth forecast for 2015 from 2.4% to 2.5%.

The lobby group has also forecast a rise in interest rates in late 2015 from 0.5% to 0.75% with a further increase to 1.5% in 2016.

Firms need to hire more young people

However, Mr Longworth says it is not quite time to celebrate yet and urged companies to embrace business growth by hiring more young people, saving them from unemployment.

He adds: “Major issues remain, such as the unacceptably high level of youth unemployment. We urge the chancellor to use this month's Budget wisely by incentivising businesses to hire young people so that the next generation of workers are not left behind.”

The BCC is also calling for more business investment and for it to be made easier for companies to gain access to business funding.

The organisation’s optimism is also echoed by accountancy firm BDO, which is predicting strong growth especially in manufacturing. Its analysis claims wages will start rising above the level of inflation this year.

Further optimism

Meanwhile, the Federation of Small Businesses (FSB) claims one in seven small businesses are planning to hire staff over the next three months and an increasing number of companies have been able to get hold of the finance they need.

This optimism is great news for entrepreneurs, start-ups and established businesses around the UK. If your company is experiencing business growth and you are looking for your first commercial premises or a larger work environment, search online to find a Bizspace business centre near you and to find out more about our excellent business services.

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