Tentative talk of recovery by FSB

Jul 1 2009 by Karen McLauchlan, Evening Gazette

A NEW survey has pinpointed a “tentative recovery” among Britain’s small firms as official data highlighted the worst slump in British output for 50 years.

A poll by the Federation of Small Businesses (FSB) said 23% of its members were experiencing an increase in trade, up from 16% in February.

More than half of respondents (57%) said they were “quite confident” about future prospects, while 68% said they planned to grow in the next six months.

The positive data was tempered by revised official figures that showed output fell by a worse than expected 2.4% in the first three months of the year - the worst quarterly performance since 1958.

However local analysts said there had been signs of improvement since March.

Alastair Thomson, dean of Teesside Business School, said: “There are signs that the economy is stabilising but there are a few very big specifics like Corus which, if they go wrong, will make a big difference locally.”

He said reduced global demand for products and services would keep a lid on the recovery, with a few months of “relatively steady activity” followed by more sustained growth from next spring.

Recent data has indicated that the worst of the recession may be over. The National Institute of Economic and Social Research estimated growth had returned in April and May, while data from the Nationwide showed house prices rose by 0.9% in June - the third rise in four months.