For the first time in what feels like years there is confidence in the UK economy as we go into the New Year. Since the start of the recession, economic outlooks have been marred by the doubts and fears that have been expressed by politicians and economists across the board. However, the outlook for this year has been described as positive for the first time in a long time – and that’s great news for all of us. The European Commission has forecast that the UK economy will grow by 2.4% in 2015, which has been supported by a number of other sources such as the British Chambers of Commerce, which predicted an even more positive 2.5%. This is in spite of the fact that growth had slowed down somewhat over the summer and towards the end of last year.
On a practical level this is going to be driven by a number of factors, such as expansion in industries like manufacturing, construction and energy. This kind of expansion should translate into more jobs in these industries with better prospects, higher salaries and more opportunities for graduates too. In fact, many people think that across the board most sectors are going to experience some sort of positive growth, although this is qualified by fears that job creation will lag slightly behind expectations. Despite this, things are looking up for the various sectors of the economy. Tony Walsh who is the Co-Head of UK, Barclays has been quoted as stating that, “the average person has more money in his pocket and that is benefitting businesses of all sizes. Construction is booming, manufacturing is growing very swiftly and the leisure industry is now picking up.” Other commentators have highlighted industries such as technology, where developments such as 3D printing and biotechnology are going to boost growth in the sector and introduce new, more cost effective options for business. For most of us, growth across sectors and more jobs should translate to more money in our pockets and an increased sense of security, which will in turn boost spending power that drives the economy.
Of course there are some warnings tied in with the economic outlook forecasts for next year and perhaps the most significant is the prospect of the Bank of England raising the base rate from 0.5%. Given the state of the economy this has been kept at rock bottom for some time but with recovery on the horizon, many – including the Organisation for Economic Co-operation and Development – have suggested that interest rates should rise this year. This could well make things difficult for first time property buyers and would result it in being more difficult to maintain mortgage payments where the interest rate is not fixed. Other – more gloomy – commentators have said that, despite positive forecasts, growth may never return to the rate it was at before the recession began. However, for all those who have struggled through the dark years of the recession it seems that there is at least a little light at the end of the tunnel.