The Brexit deadline extension provides breathing space for politicians negotiating the future relationship between the UK and EU, but prolongs the period of uncertainty for businesses.
Alongside this uncertainty, UK economic growth remains subdued, while productivity, business investment and business confidence have fallen. It is a challenging context for organisations to navigate.
The attached economic briefing seeks to help by providing a focused assessment of a small number of key national and international economic trends to help inform and shape plans and investment decisions as well as help to identify new opportunities.
GDP growth remains subdued
UK economic growth increased slightly in the first few months of 2019 but remains subdued. Projections for 2019 anticipate modest growth which will remain stable over coming years.
Productivity reported a decline
UK productivity, as measured by output per hour, reported decline in output per hour for consecutive quarters in the second half of 2018. This represents a continuation of the UK’s ‘productivity puzzle’, with productivity since the economic downturn in 2008 growing more slowly than during the long period prior to the downturn.
Business confidence falls
In quarter 1 of 2019 all UK regions reported a fall in business confidence on the previous quarter. This was the second consecutive quarter where all regions reported a negative outlook.
Business investment continues to decline
Business investment was also estimated to have declined in the final quarter of 2018. This is the fourth consecutive quarter-on-quarter fall in business investment. The last time this happened was in the economic downturn of 2008 to 2009.
Unemployment continues to fall
Despite the negative outlook across other indicators, the unemployment rate continued to fall and is now the lowest it has been since November 1974 to January 1975.
The key economic indicators covered in this report are:
- GDP growth
- GDP forecasts
- Interest rates
- Exchange rates
- UK Trade
- Industry views
- Regional outlook
Download the quarterly economic briefing for a short overview of the current trends along with a brief analysis of what it means for businesses. [ 527 kb ] We have also included an overview of the latest government and political situation. We hope that these provide additional insight and context.
We'd like to hear your thoughts on this briefing. To discuss, please contact Rob Turner.