UK economic growth figures revised: What it means for your business
The latest figures from the Office for National Statistics (ONS) reveal that the UK’s economy grew by 0.5% between April and June, a slight dip from the initial estimate of 0.6%.
This adjustment, largely due to sharper-than-expected declines in the manufacturing and construction sectors, comes at a pivotal moment as the Labour government gears up to unveil its first Budget at the end of the month.
So, what could this mean for your business?
Firstly, let’s talk about manufacturing and construction. The production of transport equipment, particularly cars, saw a significant drop of 3.1%. According to the ONS, it seems that many car manufacturers are reducing output in preparation for a shift to electric vehicles. For businesses involved in these sectors, this may be a crucial moment to consider strategies carefully and consider investing in technology that aligns with future trends.
On the construction front, while reporting a continuing decline in building new homes, ONS said there are some signs this is beginning to ease. If you're in the construction business, this may offer some positive news for coming months.
Interestingly, households are saving more, with the saving ratio climbing to 10% in the spring. While that might sound positive, it can lead to less consumer spending, particularly on non-essential items. If your business relies heavily on discretionary income, think about how you can add value - perhaps through loyalty programs or personalised marketing - to encourage people to spend.
Looking ahead, there’s also the question of interest rates. The recent downward revision in growth figures may further support that the Bank of England made the right call in cutting the base rate in August. It may make a further rate cut in November more likely.
How much these latest figures might affect the upcoming Budget is uncertain, however they do highlight the need for businesses to remain flexible and proactive. If you would like personalised advice for your business, please just get in touch. We would be happy to help you.
See: https://www.bbc.co.uk/news/articles/c8djelgl6y8o
The Prime Minister and Chancellor met with business leaders last week and unveiled proposals to give occupational defined pension schemes more flexibility.
The new economic secretary to the Treasury, Emma Reynolds, has said that there are no plans to regulate businesses, whether big or small, to compel them to accept cash.
