Our economy should escape a double dip recession, but we will see growth slow down, according to the BCC.
The British Chambers of Commerce thinks that we are not at as much risk of a double dip recession as some industry experts are making out.
David Kern, the BCC’s economic advisor said that we can expect to see slow growth in the immediate future and that if things are going to pick up, it will not be until the second half of next year.
The Chamber also believes that the effect on the economy of the public sector spending cuts has been somewhat exaggerated.
However, Professor David Blanchflower does not share Kern’s optimism. The former member of the BoE’s Monetary Policy Committee believes that the government’s austerity cuts could push the country back into recession.
Earlier this week, the Professor said he is concerned that the first quarter of 2011 is going to be terrible. He thinks that drastic cuts are not the answer and George Osborne should have spread the cuts out over a long time.
Meanwhile, the FSB has reported that 10% of firms are expecting to cut jobs over the coming 3 months after the recent weakening of business confidence.
The results of a recent survey carried out the Federation showed that over 33% of firms reported that their revenue declined in quarter 3. Small businesses and freelancers now want the government to provide a strategy for growth to go alongside the spending cuts.
The government is hoping that the private sector can create more jobs to absorb some of the public sector fall out. But the impending VAT rise and the austerity measures are going to be too much for a lot of small businesses to cope with.
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