Send us your pictures, video, news and views by texting NORTHERN ECHO to 80360 or email us
CBI expects unemployment to fall as GDP increases
THE UK'S economy will grow at pace as unemployment falls and businesses invest more and increase exports, a major think tank report has claimed.
The CBI says it has increased its growth forecast, with bosses expecting GDP to increase to 1.4 per cent in 2013, which represents a rise from its 1.2 per cent estimation in August.
It says the economic recovery will increase from 2014, with GDP expected to hit 2.4 per cent, rising to 2.6 per cent growth in 2015.
Bosses believe the UK's unemployment rate will drop as productions increases, with the amount of people out of work forecast to fall from 7.7 per cent in 2013, to 7.3 per cent in 2015.
The report also reveals forecasts for business investment growth to increase from -4.9 per cent in 2013, to 8.3 per cent in 2015, with domestic demand boosting import growth from 0.3 per cent to 4.2 per cent.
John Cridland, CBI director-general, said: “The UK is now set fair for growth with confidence returning to Britain’s entrepreneurs.
“The recovery that started in the service sector has fanned out to manufacturing and construction, and is shaping up to be more broad-based.
“The recovery won’t be spectacular, just slow and steady, but appears more solid and better-rooted.
“We’re also expecting business investment to pick up over the next two years and beyond, and net trade will begin to make a stronger contribution to growth. “By 2015, the CBI is forecasting growth of 2.6 per cent.”
The report also predicted household spending would strengthen between now and 2015, thanks to improved confidence and credit conditions, with earnings growing as inflation falls back.
Stephen Gifford, CBI director of economics, added: “Consumer spending will rise, underpinned by increased confidence, improved credit conditions and a gradual pick-up in real incomes.
“But risks remain, despite the relatively stable global environment of the past year.
“With financial markets moving to a new regulatory environment, and the Eurozone continuing to evolve, emerging markets facing structural change and the challenge of unwinding unconventional monetary policies.”
Comments are closed on this article.