Those in the UK’s contracting community may be interested in a new claim about the prospects of economic recovery made by one of the UK’s foremost business organisations – the British Chambers Commerce (BCC). But those of a nervous disposition may want to look away now; if the BCC’s economic adviser, David Kern, is correct in his forecasts, recovery could well take up to half a decade.
Figures from the Office for National statistics show that the economy officially exited recession in the final quarter of 2010 – that is, after three successive quarters of economic growth. Before anyone starts popping champagne corks, however, it may wise to be mindful of the prospective impact of the recently announced cuts in public expenditure, which some commentators fear will plunge the economy into a period of contraction.
Whilst the prospects look more favourable now to how they appeared during the blackest phase of the recession back in 2008-2009, Mr Kern is of the view that the downturn, which lasted six quarters, is bound to result in permanent losses. Steady growth will return, he believes, but from a significantly lower base – and we’re unlikely to see any real signs before four to five years are up.
Forecasts, of course, are not cast iron predictions. Economic affairs are notoriously subject to contingencies, both for good and for ill. Even so, David Kern is not known to be a doom monger; for the jobbing UK contractor, it’s better to go forward with a realistic perspective on the prospects for contract jobs than to march onwards in blissful ignorance. If investor confidence rises as a result of the government’s action on spending, though, we may well see the sun beneath those recessionary clouds bursting through far sooner
