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Positive Economic News for the UK

businessAnother week, another batch of positive economic news from across the spectrum. 2014 sure is different from recent years.

Employment on the rise, manufacturing buoyant, interest rates on hold for another month and organisations tripping over each other to provide positive outlooks all round.

The Office of National Statistics (ONS) has reported that in the quarter to April 2014, the number of people in work grew at the fastest rate since 1971, the point at which records began.

In total 345,000 more people were in work compared to the previous quarter, meaning a total of 30.54m were employed in the UK in Q1 2014.

More good news came in the outlook for employment prospects with a survey from recruitment company Manpower reporting that 11 out of 12 regions expected to see recruitment activity increase over the coming quarter.

Only Northern Ireland and the construction sectors didn’t share the sentiment. As a corollary, unemployment fell from 8% 12 months ago to 6.8% today.

Mark Cahill, UK Managing Director of Manpower said:

“While job prospects have been strong, it’s only now that we’re seeing a return to pre-recession hiring plans. What’s more, we’re seeing broad-based growth across permanent roles, the self-employed and contractors”

Minister of State for Employment, Esther McVey, reacted to the latest statistics saying:

“As we build a stronger economy, businesses up and down the country are feeling increasingly confident about creating jobs, meaning many thousands more people are in work every day – ensuring a better future for them, their families and for the country as a whole.”

However whilst employment prospects are strong, wage growth is less so, and whilst this isn’t universally welcomed it again provided potential good news for the recessional recovery of the UK’s small businesses.

After wage growth exceeding the prevailing inflation rate in the previous quarter, growth was down to 0.9% (Excluding bonuses) compared to CPI inflation of 1.8% in April.

Samuel Tombs, UK economist at Capital Economics, said the figures illustrated that:

“While the unemployment rate is continuing to fall, there is still enough slack in the jobs market to prevent wage growth from picking up”.

The Engineering Employers Federation (EEF) added its stamp on the positive news reporting that they had upgraded their forecast for manufacturing output growth to top 3.6% in 2014 against their previous estimate of 2.7%.

Tom Lawton, Head of Manufacturing at BDO, the accountancy and business advisory service said:

“The most encouraging aspect of this recovery is that it is so robust in nature, with all sub-sectors showing an increase in output.”

All in, the first quarter’s results have made a pleasing change from recent history and with the economy picking up across all sectors and regions, the prospects for SMEs as the engine house of the UK economy have rarely been higher in recent years.

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