A persistent slowdown in activity among private sector firms could weigh on economic growth over the coming months, with businesses set to cut staff and raise prices, according to a CBI survey. PA Media reports:
The upcoming increase to national insurance contributions has prompted firms to assess their budgets urgently, the CBI said.
Output across the private sector is expected to drop over the next three months, having fallen over the previous three-month period, the survey found.
Activity has been flat or falling since the middle of 2022, reflecting a prolonged period of stagnation.
The CBI, a membership organisation which represents large chains through to small businesses, surveyed 990 firms between December and January.
The survey suggested that sentiment among businesses dipped in the aftermath of the Government’s autumn budget.
Some respondents highlighted that the tax rises had resulted in them reviewing their budgets at short notice and taking steps to mitigate higher costs.
Plans include raising prices to pass on additional costs to clients, trimming investment plans and cutting staff to reduce business expenses.
Alpesh Paleja, interim deputy chief economist for the CBI, said: “After a grim lead-up to Christmas, the New Year hasn’t brought any sense of renewal, with businesses still expecting a significant fall in activity.
Responding to the survey, Andrew Griffith, the shadow business secretary, said: “Businesses are clear that the real blocker to growth is Rachel Reeves and the mistakes being made by this government.”
Good morning. It is Holocaust memorial day, and the 80th anniversary of the liberation of Auschwitz, and the Westminster politics news is relatively light this morning because broadcasters have been focusing on these events. No 10 did not even have a minister doing a morning interview round. Jakub Krupa, who recently took over writing the Guadian Europe live blog, is covering all the relevant events here.
The big Westminster news yesterday was the fact that Keir Starmer and Donald Trump have had their first conversation since the inauguration. They spoke for 45 minutes, after Trump gave a peculiar “very good person” (for a liberal) endorsement of Starmer to reporters on Air Force One. (It was slightly patronising – “he’s done a very good job thus far” – but, from the No 10 point of view, a lot more welcome than what gets said when the president is in ‘bad Trump’ mode.) Eleni Courea has the story here.
And this morning the Times is reporting some fascinating polling that will alarm anyone who thinks that that the election of Trump is evidence of a global shift in political thinking with worrying consequences for democracy. It suggests young people think authoritarianism is preferable.
Recently we reported on polling suggesting that one in five Britons between the ages of 18 and 45 “prefer strong leaders without elections to democracy”. The new poll is a more extreme version of the same trend.
In his Times story, Alex Farber reports:
Most young people are in favour of turning the UK into a dictatorship, according to a “deeply worrying” study, which has revealed an acceptance of authoritarianism and radicalism among Generation Z.
Fifty-two per cent of Gen Z – people aged between 13 and 27 – said they thought “the UK would be a better place if a strong leader was in charge who does not have to bother with parliament and elections”.
Thirty-three per cent suggested the UK would be better off “if the army was in charge”.
Forty-seven per cent agreed that “the entire way our society is organised must be radically changed through revolution” – compared with 33 per cent of 45 to 65-year-olds.
The polling was carried out by Craft for a Channel 4 report, Gen Z: trends, truth and trust, being released later this week.
Here is the agenda for the day.
After 10.30am: Kemi Badenoch gives evidence to the Covid inquiry, in its module on vaccines and therapeutics, in her capacity as a former equalities minister.
11.30am: Downing Street holds a lobby briefing.
2.30pm: Bridget Phillipson, education secretary, takes questions in the Commons.
Afternoon: Nadhim Zahawi, the former vaccines minister, gives evidence to the Covid inquiry.
4.30pm: Ed Miliband, the energy secretary, gives evidence to the environmenal audit committee on the outcome of the Cop29 climate conference.
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