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Round-up of the week

Posted on 1st April 2016

UK economy continues to grow

Gross domestic product in the UK grew by 0.5 per cent between October and December 2015, the Office for National Statistics (ONS) has revealed.

This means that the economy grew by 2.2 per cent throughout 2015 as a whole, which is unrevised from the estimate it had previously published.

Current account deficit reaches record high

Sentiment regarding the recent economic growth has been tempered by ONS figures that also show the UK's current account deficit has risen to an all-time high. The CBI, for instance, believes this poses a risk to the UK.

Rain Newton-Smith, director of economics at the body, commented: "Furthermore, it could increase pressure on the pound, which has fallen in recent months.

“Export growth remains weak, and with global economic momentum softening and strong domestic demand driving imports higher, we don’t expect much to see much of a boost to the economy from net trade."

Ms Newton-Smith also pointed out that the dip in business investment towards the end of the year was disappointing. However, she went on to stress that official data can be "volatile".

"The CBI’s economic surveys suggest that investment intentions for the year ahead are holding up and profitability remains solid, so we expect business investment to make a decent contribution to growth," she commented.

"There could be exceptions though, with capital spending in the North Sea hit by low oil prices, and manufacturers having a tougher time."

Chancellor of the Exchequer George Osborne responded to the figures by saying they show the resilience of the UK economy.

However, he pointed out that the slowdown in the global economy could affect the outlook for the UK.

"Today's figures expose the real danger of economic uncertainty and shows that now is precisely not the time to put our economic security at risk by leaving the EU," he commented.

Digital skills important to employers

Digital skills are proving to be increasingly important to recruiters, according to a new survey.

Research by Barclays UK revealed that 27 per cent believe an understanding of data and device protection is very important.

Meanwhile, 20 per cent want new recruits to be able to use cloud-based tools and services for collaboration and storage. In addition, 15 per cent find coding skills desirable.

The study also showed that one in three employers are struggling to digitally upskill their workforce, while the average firm is putting just £109 towards training individual employees in digital skills per year.

As a result, 40 per cent are relying on graduates and younger employees to arrive equipped with the digital skills they require.

Ashok Vaswani, chief executive of Barclays UK, commented: "The digital revolution is having a profound effect on our lives by dramatically changing the way we live, work and interact with one another. Although in many ways this is empowering it can also be challenging, because it requires people and businesses to acquire, retain and consistently develop new skills and understanding to truly benefit."

To discuss conditions in the labour market and operating environment further, speak to one of our experts here at The Maine Group!