Weak final quarter of 2019 highlights the difficulties faced by the government to reignite growth momentum in the UK economy” says Yael Selfin, Chief Economist at KPMG UK.
“Dwindling strength of consumer spending, despite low unemployment and rising households’ purchasing power as wage growth remains robust, call into question the strength of growth we could expect this year. The gradual slowdown points to more hard times for retailers as households rein in their spending.
“The sharp deterioration in retail sales in Q4, coupled with an on-going weakness in the hospitality sector point at households’ lost appetite to spend in the face of continued uncertainties. The latest BRC KPMG figures for January indicate only a relatively minor reprieve following the elections results and UK exit from the EU.
“Timid growth in December 2019 rounds off a disappointing decade for living standards. Overall, the level of GDP increased by 18%, between 2010 and 2019, the second slowest rate of increase after the 2000’s which ended with the economy in the midst of the Great Recession. Growth in GDP per capita was also the worst on record, reaching 1.14% over the decade, compared to 1.23% for the 2000’s.
““It is important for policymakers to address the underlying weakness in productivity across all the regions of the UK in the coming decade to ensure incomes rise more strongly and that growth is more evenly shared.”
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