THE economy will continue to make headway in 2011 – but growth will be patchy and slow, said a survey by the CBI today.
Despite a squeeze on household income and the impact of public sector spending cuts, the UK’s leading business group expects the UK economy to grow by 1.7% this year, only marginally lower than the previous forecast of 1.8%.
Growth of 2.2% is expected in 2012, down slightly from February’s forecast of 2.3%.
Stronger exports are expected to make an important contribution to the UK economy both this year and next. Export growth of 8.6% in 2011 and 7.6% in 2012 is expected to outpace the rise in imports over the period.
Business investment is also expected to help drive economic growth. The survey reported strong investment intentions with forecast growth of 8.8% in 2011 and 8.7% in 2012.
Andrew Palmer, CBI regional director for Yorkshire and the Humber, said: “Although there are a number of risks to the UK’s economic outlook, we continue to expect that the recovery will make further headway this year and next, but the pace will be sluggish.”
He said: “Concerns remain over the volatility of oil prices and the impact of the earthquake in Japan on UK supply chains.”