According to a quarterly survey by the British Chambers of Commerce (BCC), business confidence is at its highest level since 2007.
The findings come amid other signs of economic recovery in the UK, leading some commentators to speculate that we are beginning to see the light at the end of the tunnel. David Kern, chief economist at the BCC, said that “the UK upturn is slowly strengthening”.
The findings of the BCC come as the Markit/CIPS purchasing managers’ index indicates that the construction sector grew in June for a second month in a row. The BCC also found that export sales had grown by their fastest rate since the survey began in 1989, and is now predicting a growth in GDP of 0.6% in the second quarter of this year - significantly higher than their previous growth forecast of 0.9% for the whole year.
The potentially good news for the economy continues, as Purchasing Managers Index (PMI) data suggests that manufacturing is growing at its fastest rate in two years, and Bank of England figures show that mortgage approvals hit a three and a half year high in May. Whilst sectors like manufacturing and construction seem to be showing signs of recovery, Kern also stated the importance of the service sector, adding that “developing the export potential of this sector is critical to long-term prosperity.”
The BCC’s director general, John Longworth, was more cautiously optimistic; while noting that “the sheer strength of our export balances shows that companies have untapped potential to expand”, he also warned that there have been “false dawns” before, but that banks failed to lend to businesses, choking recovery.
UK businessman and former chairman of Pizza Express, Luke Johnson, welcomed today’s findings, stating:
“I think the consistency of all the surveys and statistics coming through over the last 6 to 12 months is pretty compelling”
He added that he senses “a rising tide of animal spirits” and that he believes that “this is now a real recovery.”
Britain’s economic recovery is still the weakest of any of the G7 countries (US, UK, France, Germany, Italy, Canada and Japan) apart from Italy.