UK economy 'grew in third quarter'
- 2 October 2012
- From the section Business
The UK economy grew in the three months from July to September, according to the British Chambers of Commerce (BCC).
Based on its survey of 7,593 UK firms, the BCC said the economy grew by 0.5% in the third quarter.
The BCC said it did not agree with the Office for National Statistics' (ONS) "gloomy estimation" that the economy had been contracting for the previous nine months.
But fixing the UK's finances would take longer than previously hoped, it said.
It called on the government for additional measures to boost economic growth, such as quickly implementing plans to create a "British business bank" as well as unlocking infrastructure investment.
"The job of repairing Britain's public finances will take longer to complete than initially planned," said BCC chief economist David Kern.
"Despite official estimates, we believe the economy is still growing, but it is slowing. We need immediate measures now to support confidence and investment, a radical long-term growth plan and a continued commitment to deficit reduction."
The BCC, which represents 104,000 business members, said that its members' confidence in future turnover and profit had fallen to levels last seen at the end of 2011.
To help promote growth, the organisation has proposed a "growth voucher scheme", offering 20,000 small businesses £5,000 worth of advice to jump start investment and expansion plans.
The ONS will release its first estimate of economic growth in the third quarter on 25 October.
It is widely expected to show a return to growth, partly due to a boost from the Olympics.
Last week, it was revealed that the UK economy contracted by less than thought in the second quarter, by 0.4% in the April-to-June period.
One volatile figure that has had a significant effect on the ONS figures has been the performance of the construction sector.
On Tuesday, the Markit/CIPS purchasing managers' index on the sector suggested that construction had contracted again in September, although at a slower rate than in August.
The index showed a reading of 49.5, which was above August's 49.0, but still below the 50 level, which would indicate no change in the sector.
"UK Construction PMI data for September presents another bleak assessment of business conditions in the sector," said Tim Moore, senior economist at Markit.
"The current stretch of falling new orders is now the longest seen for three years, reflecting shrinking underlying demand alongside delays in spending from both public and private sector sources."