BCC responds to ONS GDP figures
14th July 2020
Commenting on GDP figures for May 2020 published today by the ONS, BCC Head of Economics Suren Thiru said:
“The latest data confirms there was a modest rally in monthly UK GDP growth in May as restrictions started to ease. However, coming after unprecedented contractions in the previous two months, it does little to alter the UK’s historically downbeat growth trajectory.
“The pick-up in output in May is more likely to reflect the partial release of pent-up demand as restrictions began to loosen, rather than evidence of a genuine recovery. While UK economic output may grow further in the short term as restrictions ease, this may dissipate as the economic scarring caused by the pandemic starts to bite, particularly as government support winds down.
“Although some of the individual measures announced in the Summer Statement were welcome, more significant fiscal stimulus is likely to be needed to help kickstart a sustained recovery. This should include new incentives for business investment and reducing the overall cost of employment through a cut in employer national insurance contributions.”