Is recession around the corner? - From Daily Business News

27th January 2025

Is recession around the corner? Private sector bosses in the manufacturing, services and retail sectors are all predicting a "significant fall" in activity over the next three months according to a survey by the Confederation of British Industry (CBI).

Business are cutting staff, moving jobs overseas and curbing investment as they battle to cut costs and offset the impact of Chancellor Rachel Reeves' Budget tax hikes.

According to the survey of 990 firms carried out between 19th December and 14th January, the service sector expects business volumes to fall by 20% over the coming months, while manufacturing output is forecast to drop by 19%. CBI economist Alpesh Paleja said: "After a grim lead-up to Christmas, the New Year hasn't brought any sense of renewal.

There is an urgent need to get momentum back into the economy. The Government can help shift the UK's economic narrative with more determined focus on measures that could drive growth." Reeves will give a speech this Wednesday unveiling her plans for growth: the economy flatlined in November, after contracting in September and October.

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