Member News
25th January 2013The Work Foundation has said the Government must continue with "a broad structural reform agenda" despite new figures showing the economy is contracting.
The ONS published figures today that show that the UK economy shrank by 0.3 per cent in the last three months of 2012. The results mean that s no growth overall for the whole of 2012.
Charles Levy, senior economist at The Work Foundation, said:
“Following three years of a flat economy, today’s GDP figures confirm that our economy is again contracting, raising the prospect of a triple dip recession.
"2012 saw considerable improvements in the labour market, with over half a million new jobs created, though many part-time. However, without growth even this improvement will be hard to sustain.
“Figures were pulled down by one-off events and an extended maintenance period for North Sea oil and gas extraction.
"Nevertheless, the poor performance of the manufacturing sector should be a real cause for concern. These numbers will increase the pressure on the Coalition government to increase support for the economy ahead of the March budget.
“However, rather than advance knee-jerk reactions or short-term injections, the government must pursue a broad structural reform agenda that can provide more convincing support for investment and innovation to drive long-term growth.
"Further targeted investments in emerging technologies and in leadership skills for SMEs could help to unlock the assets that our economy already possesses."
Chancellor George Osborne told Sky News:
"I am absolutely clear we have got the right plan, but of course it is not a plan that was ever going to deliver results overnight.
"We said from the start, it was a long, it was a hard road but it was the only road this country could walk down.
"If we were to lose the confidence of the international community in our ability to pay our debts, that would be catastrophic for the British economy."