UK economy still grew in the second quarter, says BCC
THE UK economy continued to grow in the second quarter of the year, boosted by a strong performance in the manufacturing sector, according to the quarterly survey from the British Chambers of Commerce published today.
The BCC said that most manufacturing balances showed relatively strong increases and in some cases were back to pre-recession levels. But while manufacturing results were good, the service sector’s results were largely weak and disappointing.
The manufacturing balance for home sales surged to +30 per cent, the best level since the last quarter of 2007. There were also welcome improvements in the manufacturing export balances, which rose 11 points to +31 per cent, the best level since the third quarter of 2007. The service sector also saw growth in both domestic and overseas sales but remained weak by historic standards.
Worryingly, business confidence in the service sector weakened in the second quarter whereas the manufacturing sector remained confident.
David Frost, director general of the BCC, said: “We still have concerns about sluggish growth in the service sector, which emphasises why the government must continue to promote the best possible business environment, in order to help companies invest and grow.”
But encouragingly, employment in manufacturing surged, rising 35 points to +19 per cent. Expectations of future hiring in the sector also improved. Once again, the improvement in the service sector was much weaker.