The British Chambers of Commerce (BCC) has slashed its forecast for economic growth this year, from 0.6{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e} to 0.1{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e}.  But the group, which represents more than 100,000 businesses, raised its forecast for 2013 from 1.8{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e} to 1.9{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e}.  The data, in the BCC’s latest Quarterly Economic Forecast, follow official figures showing that the UK has returned to recession.

Unemployment will also increase from 2.625 million – or 8.2{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e} of the workforce – to 2.9 million, or 9{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e}, in the third quarter of 2013, driven primarily by continued public sector spending cuts.

The BCC’s report warns that problems in the eurozone will persist for a considerable time and cause difficulties for UK businesses.

However, household spending will see modest improvement, from shrinking 1.2{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e} in 2011 to growth of 0.7{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e} in 2012, 1.7{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e} in 2013 and of 2.1{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e} in 2014.

Business investment should improve, from 1.2{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e} in 2011 to 4.3{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e} in 2012.

Credit: onrec.com