Swindon business leaders today welcomed the latest positive national economic figures but concerns remain that the pace of growth is slowing and further problems could lie ahead.
The Office for National Statistics figures show the UK’s gross domestic product (GDP) grew by 0.7% in the three months to September – slightly weaker than the 0.9% of the previous three months but 3% higher than the equivalent period last year.
Chancellor George Osborne welcomed the figures but warned the recovery is not immune from the weakness in the Eurozone – by far the UK’s largest export market – or a fear slowdown in the world economy.
Ian Larrard, director of the Swindon & Wiltshire Initiative, part of Business West, warned that weaknesses remain in the economy which need to be address.
He said: “We have seen the national economy – and therefore local economy – go from strength to strength throughout 2014 and the 0.7% increase in GDP in the third quarter of 2014 will give business a shot in the arm. GDP is now 3.4% above its pre-recession peak, showing the progress we have made. South West unemployment dropped by 44,000 over the past year and our recent business survey of businesses in Swindon & Wiltshire found that the major indicators – domestic sales (48%), recruitment (23%) and business confidence (65%) – are all up on this time last year.
“However, compared to last quarter, our survey shows a drop in all major indicators, due in part, we believe, to a disruptive Scottish Independence vote and sluggish growth in the rest of Europe. Although GDP growth is welcome news, it will be muted by signs of a slowdown.
“We must not be complacent and must strive to address the fundamental weaknesses in the economy. What is needed now is for the MPC and the government to reinforce efforts to support the recovery. Interest rates must be kept at their current low levels well into 2015, while the Chancellor’s Autumn Statement in December must include bold measures to support growth and enterprise.”
Swindon and Wiltshire Local Enterprise Partnership (LEP) chair Barry Dennington said more upbeat, arguing that Swindon in particular is reaping the rewards of the recovery to re-establish its position as a forward-looking business centre.
“We are delighted that the GDP figures show an up-turn in the UK economy and that the recession is turning a corner,” he said. “This shows that we are on track to address the priorities identified in the Swindon and Wiltshire Strategic Economic Plan.
“The positive news is confirmed by local evidence – a recent Centre for Cities report showed that Swindon's small businesses are fourth in the UK for fuelling economic recovery and we continue to engage with and invest in small and medium-sized enterprises across the LEP area through the Wiltshire Business Hub, providing support and information to this important sector of the UK economy.”
And the recovery is helping secure a bright future for one of Swindon’s most innovative firms, according to its chief executive.
Graeme Rumbol, CEO at South Marston-based Tetronics International, which develops technology used in recycling and hazardous waste treatment, said the firm was strengthening its position in the global market.
“As a British environmental company specialising in resource recovery and hazardous material treatment, we have experienced significant global export and forecast continued rapid growth both in the UK and overseas,” he said.
“This global export success has translated into a 40% rise in employment for Tetronics from 2013 to 2014.”
The CBI welcomed the GDP figures and said growth should continue despite Europe’s weakness.
Director-general John Cridland said: “The economy is still growing steadily, with businesses creating jobs and investment progressing.
“These figures show that growth was predominantly driven by a robust services sector. However, we know that times are getting tougher for our industrial base, with our latest manufacturing survey showing that exports are weighing on the sector.
“Risks to growth remain, including global political instability and mounting weakness in the Eurozone, but the CBI still anticipates that healthy growth will continue.”
