Government urged to 'firm up foundations for growth'

12 Dec 2023

The Confederation of British Industry (CBI) has warned that UK firms are gearing up for another tough year in 2024, and urged the government to 'firm up the foundations for growth'.

In its latest economic growth forecast, the CBI stated that 'significant headwinds' will affect UK growth in 2024. The business group expects GDP growth of 0.8% next year, rising to 1.6% in 2025.

It also predicts that growth in consumer spending will 'remain weak' next year at 0.4% as higher interest rates adversely affect household incomes.

Additionally, the CBI expects 'sluggish growth' to impact business investment in 2024, which it predicts will fall by 5%.

Commenting on the forecast, Louise Hellem, Chief Economist at the CBI, said: 'Amid the sheer degree of headwinds that the economy has faced over the last couple of years, businesses and households have shown remarkable resilience. Let's not forget that even the weak growth we've seen is better than expectations of a recession this time last year.

'But that is by no means job done. Businesses are gearing up for another tough year ahead, with our forecast expecting weak growth to persist over 2024. Given that this is coming after an already challenging few years, it's clear that the 2020s have yet to roar.'