The UK’s slowing economy underlines the concern Greater Birmingham businesses have over exchange rates and their impact on costs, business leaders said today.
This followed the announcement by the Office for National Statistics that the UK gross domestic product (GDP) was estimated to have increased by 0.3 per cent between January and March, the slowest rate of growth since Quarter 1 2016.
Slower growth was said to be mainly due to services, which grew by 0.3 per cent compared with growth of 0.8 per cent between October and December.
In Quarter 1 2017 there were falls in several important consumer-focused industries, such as retail sales and accommodation; this was due in part to prices increasing more than spending.
Production, construction and agriculture grew by 0.3%, 0.2% and 0.3% respectively in Quarter 1 2017 GDP per head was estimated to have increased by 0.1% during Quarter 1 2017.
Paul Faulkner, chief executive of Greater Birmingham Chambers of Commerce (GBCC), said: “As expected, the UK posted a slower rate of growth for the start of 2017. Nevertheless, we should be mindful of the fact that growth levels in the UK have held up pretty well since the referendum result and this is a real testament to the strong foundations which underpin the British economy.
“It is not surprising to see retailers putting up prices due to higher input costs as a result of the falling value of the pound. However, it is heartening to see the manufacturing sector grow by 0.5 per cent last quarter, although this is unlikely to change the overall direction of growth as the service sector accounts for the majority of the UK’s economic output.
“Both of these overarching trends have been reflected in the findings of our latest Quarterly Business Report; local businesses are increasingly concerned about higher costs and manufacturers in the region have posted stronger growth rates than their service sector counterparts.
“The British Chambers of Commerce are releasing their manifesto on May 2 and we are backing their agenda,