Finances Finally Get Some Relief as Economic Picture Brightens

18th April 2018.

There is finally cause for optimism, as UK wages rise faster than inflation for the first time in more than a year as the British economy continues to defy expectations of a Brexit slump.

The economic picture has been rather bleak in recent months, with high inflation, interest hikes and a so-called ‘retail apocalypse’ tearing apart the high street. Finally, however, it seems the picture is brightening, with inflation down to a one-year-low and wage growth finally improving. Unemployment has also dropped once again, which along with the rise in pay, creates a more hopeful work environment for employees. As consumer prices reduce, consumer behaviour could be set to change, with people returning to the high street after a year’s hiatus.

At the Credit Protection Association, many of our members have suffered from high business costs and a persistently tough economic climate. While we cannot expect a major cultural shift in the next year, our debt recovery services at CPA will ensure all our members have strong cash flow as they charge ahead into the next quarter of 2018. Keeping this positive picture is vital if our businesses are to make it to the Brexit deadline next year.

Data released in March showed inflation at 2.7 percent in February, and economists expect it to edge down further as Sterling’s value improves.

Furthermore, Britain’s employment rate has hit a record high, joblessness is at a 43-year low and wages are rising in real terms for the first time in a year, according to official figures.

Philip Hammond, the chancellor, claimed that record employment should help fix the UK’s chronic productivity problem. “We should expect record levels of employment to drive the productivity performance of the UK economy,” he said.

Bank of England officials have flagged accelerating wage growth as one reason for a hawkish shift in monetary policy, saying they have “increasing confidence” that pay is picking up after a long period in which it failed to match strong employment.

While the UK economy is far from picture perfect, certain positive developments, from employment to wage growth, suggest that the next quarter may indeed be easier than the last. We cannot expect the good news to continue without effort, however, and businesses should ensure their cash flow and revenue is going to sustain the positive sentiment.

At the Credit Protection Association, our debt recovery services bring our members the extra cash they need for new ventures and work projects. By chasing unpaid invoices and tracking down late payers, we ensure our members are financially confident, as well as rightly cushioned against any future economic downturns.