Latest GDP Figures

There was little surprise in the Office for National Statistics’ figure of -0.2% for the first quarter of 2012. The Greater Manchester Chamber of Commerce has now stated for some time its belief that the country is now in a low-growth environment and that both positive and negative quarters can be expected; this is no cause for panic.

GDP shrank by 0.2% in the first three months of 2012 according to the Office of National Statistics

Christian Spence, Research Manager at Greater Manchester Chamber of Commerce, said: “There was little surprise in the Office for National Statistics’ figure of -0.2% for the first quarter of 2012. The Chamber has now stated for some time its belief that the country is now in a low-growth environment and that both positive and negative quarters can be expected; this is no cause for panic. Mostly driven, as expected, by a sharp contraction of 3% quarter-on-quarter in the construction sector, the wider economic picture remains fragile but broadly bears out our own predictions from the data we collect from our members.

“Whilst the official figures show a small decline in the measure for manufacturing, our own Quarterly Economic Survey suggests that the sector is performing more strongly than this in the region, though the fact that the service sector is the only one to show growth this quarter (driven by utilities) reinforces our belief that, whilst the government is right to hold firm to its deficit reduction strategy, more needs to be done to help support businesses to grow. There remains the likelihood that this figure will be revised in the coming months as the strong retail sales figures from March, driven by the spell of good weather and the increased sales volumes for fuel around fears of a strike, will only be fully accounted for in later estimates.

“The Chamber remains confident about the ability of its member businesses in Greater Manchester to continue to drive growth in the region, particularly as they continue to seek opportunities to market internationally, though we urge the government to do more to support the delivery of its aim to rebalance the economy away from the capital. The construction sector has had a particularly turbulent time since the start of the recession, driven by a lack of access to significant investment capital for new starts and also by constrained public sector budgets.

“The Chamber again reiterates its support for large-scale infrastructure projects in the regions such as the £560m Northern Hub and other developments such as the more intensive use of the Manchester Ship Canal through imaginative projects like Atlantic Gateway. Government investment spending has, since the election, been heavily focused on London and the South East and, if the government is keen to truly rebalance the economy and support the regions, we must see real and tangible action to support the wider domestic economy.”