Higher costs hitting businesses this year and months of slowdown in GDP mean slight growth of 0.1% in the UK economy will not alleviate worries, says East Midlands Chamber.
The Chamber’s comment comes as the latest estimated figures from the Office for National Statistics showed GDP grew less than economists anticipated in November.
East Midlands Chamber Director of Policy and Insight Richard Blackmore said: “While a return to economic growth, albeit slight, is the right direction of travel and not unwelcome, we’re talking about a tiny step forward here and we must remember that toward the end of last year we saw growth slow and stall. With the bitter cocktail of employer National Insurance hikes hurtling down the road onto cost sheets, a higher national minimum wage and a lower threshold at which NI payments need to be made, most businesses will be laser-focused on those things right now.
“I would hope that a slight GDP lift is an encouraging indicator but with the up-down turbulence we’ve seen in the economy this is no comfort yet; we’d need to see a bigger lift or trend of continuous growth for that realistically. An interest rate cut could be a possibility next month, but right now wading through the rough waters of measures announced in the Autumn Budget are the greater issue for East Midlands businesses, as we know from our own research.
“Corporate taxation, pressure to raise prices and footing the bill of higher staffing costs are currently top of the concerns businesses in the East Midlands have and that came out loud and clear in our recent Quarterly Economic Survey, which is based on both sentiment and measurable data from firms in the region. It’s essential that political leaders prioritise growth in the East Midlands with supportive policies that help businesses at this tough time.”
To view East Midlands Chamber’s Quarterly Economic Survey for Q4 2024 click here.
