UK economy doing better than GDP figures suggest

New data suggest that the UK’s economic growth has been understated by official figures, and is also likely to strengthen in the coming months.

 

A survey of small and medium-sized manufacturers revealed that many saw increases in total domestic orders, output and employment in the three months to April.

 

Firms are also expecting output to increase further over the next three months, according to the survey of 426 manufacturers published today by the Confederation of Business Industry.

 

Meanwhile, Lloyds Bank’s business confidence barometer released today scored 53 for April. While the figure is unchanged from March, it is well above its long term average of 31 since the survey began in 2002.

 

“Business confidence remained steady over the past month, confirming that the UK economy is continuing to expand at a good pace, helped by the impact of lower oil prices and tentative signs of a Eurozone recovery, despite Greece’s ongoing problems,” said Trevor Williams, chief economist at Lloyds Bank Commercial Banking.

 

“The latest results suggest that the Office for National Statistics’ preliminary estimate of 0.3 per cent for quarter-on-quarter GDP growth could be revised up in due course”.

 

Official figures showed that economic growth slowed at the start of the year. The economy grew by 0.3 per cent in the three months ending March, compared with 0.6 per cent in the final three months of 2014.

 

There are also many positive signs coming from the jobs market.

 

Job search website Adzuna has today forecast that the unemployment rate could reach five per cent by July, based on current hiring patterns. 

 

The unemployment rate was 5.6 per cent in three months to February, according the ONS. However, Adzuna estimates that unemployment likely stayed flat in March and April.