Revamped Business Finances Could Revive Slow Economy

25th May 2018.

Almost all parts of Britain’s economy slowed down in the first three months of the year, official figures have confirmed, with investment falling and exports failing to give growth a much-needed boost.

Despite various upturns in the economy, such as jumpstarted wage growth, and low inflation, the overall economic picture is not so positive. According to new figures from the Office for National Statistics, there have been signs of a significant slowdown in the economy. GDP growth was significantly slower than expected, with an increase of a mere 0.1 percent in the first three months of the year. This is the slowest pace reported since 2012 and has economists fearing for the years ahead.

Construction output and household spending also further decreased, creating further trouble for the sectors and their future prospects. Experts are disagreeing over the cause of the slowdown, however, with the bad weather having varying levels of impact. Whatever the cause, any downturn in the economy can be enlivened by focussing on cash flow. At the Credit Protection Association, our debt recovery services restore financial confidence and help our members weather any dip, tailspin or economic downturn.

“Taking together the forces of Brexit uncertainty, softening indicators in overseas markets and consumers that have yet to regain their mojo, it is hard to see what will spur some renewed momentum in the economy over the next couple of quarters,” said Lee Hopley, chief economist at manufacturing industry group EEF.

Construction output dived 2.7pc, though this is less extreme than the 3.3pc drop estimated initially.

Meanwhile, both household spending growth and business investment slowed to 0.2pc in the quarter, adding to the retail sector’s woes.

The services industry, which makes up a dominant share of the economy, expanded by a mere 0.3pc.

However, Bank of England Governor Mark Carney said he believes the economy is stronger than the official numbers suggest, arguing the ONS’s measures of the impact of the weather are less reliable than the Bank’s.

As a result, he thinks the weather had a more significant effect and so the economy has more underlying strength.

Despite the slow start, economists do anticipate a modest recovery in the rest of the year.

Whether the economy upturns or downturns, businesses should be prepared for either. The easiest way to coax strong economic growth is through the performance of its businesses, and how their business finances are managed. At the Credit Protection Association, our debt recovery services free up cash flow for our members, while our credit checks and status reports protect their financial future.

Prolonged levels of political uncertainty and economic instability have taken their toll on business confidence. Approaching a third party like CPA could not only provide some extra cash but restore some of this lost self-assurance, for both the economy’s sake and for individual businesses.

The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!

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