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Entrepreneurs Panel

Julie Meyer
Steve Purdham
Brian Hay
Debbie Pierce
Charlie Mullins
Jeremy Roberts
Michael Oliver
David Pollock
Richard O'Sullivan
Laura Tenison
Jennie Johnson
Tony Caldeira

Services drive stronger than expected growth in Q4

The economy grew by 0.6 per cent in the fourth quarter of 2016, largely thanks to the services sector and better than expected consumer spending, according to official figures.

The Office for National Statistics said the rate of GDP growth between October and December was the same as the previous two quarters.

Growth for the year was estimated at two per cent, slowing slightly from 2.2 per cent in 2015 and 3.1 per cent in 2014.

Services dominated growth in Q4, with a strong contribution from consumer-focused industries such as retail and travel agencies.

Following falls in Q3, construction and production provided negligible positive growth in Q4.

GDP per head was estimated to have increased by 0.4 per cent during Q4 and by 1.3 per cent during 2016.

Rain Newton-Smith, chief economist at the Confederation of British Industry, said: "These figures confirm that the economy has remained resilient in the wake of the EU referendum, growing two per cent in 2016 - in line with our latest forecast.

"Services remain the key driver of growth and a recovery in manufacturing also provided some support, although the continued weakness seen in the construction and mining sectors remains a cause for concern.

"2017 will see headwinds to growth building, as higher inflation eats into households' buying power and investment wanes.

"As the UK economy enters a more challenging environment, the Government's recent commitment to a new Industrial Strategy will be an important step to ensuring that prosperity reaches all parts of the UK."

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