The UK economy grew by a modest 0.1% in November 2024, driven primarily by a slight rebound in the services sector, according to official figures released yesterday.
This followed an unrevised contraction of 0.1% in October.
However, the three months to November showed no overall growth compared with the preceding quarter, underscoring the stagnant state of the economy.
Despite the uptick, business sentiment remains overwhelmingly negative. Experts told Newspage about the implications of this minimal growth and the broader challenges facing the UK.
MOOD DECIMATED
Rakesh Dua, Chief Executive at DUA Accountancy & Business Consultancy, emphasised the critical role of confidence: “There are stats and figures, but what ultimately counts is confidence and mood.
“Mood in the business community has been decimated due to current government policy.
“Business owners are questioning why they should take risks, hire, or invest when growth is absent and customers may not tolerate further price increases. Confidence is in extremely short supply.”
LACK OF VISION
David Belle, Founder of Fink Money, criticised the Labour government’s approach: “There was negligible growth in November and zero real growth during the quarter.
“Starmerism is based on rules with no vision. There’s no big idea beyond ‘we’re fixing what the Tories did,’ and that no longer cuts it.
“The Bank of England may accelerate rate cuts, particularly after a softer inflation print, but this could backfire if inflation rebounds. The lack of coherent policy direction is a major concern.”
BANK BURDEN
Independent Financial Adviser Riz Malik of R3 Wealth argued that monetary policy might need to take the lead: “We are stuck in no-growth Britain with no-growth Rachel [Reeves].
“Hopefully, the Bank of England takes this into account when they meet next month. Unfortunately, it seems they’re the ones left to jumpstart the economy.”
Rohit Kohli, Director at The Mortgage Stop, highlighted the challenges posed by government policy changes: “While services rebounded slightly, concerns over April’s National Insurance changes are weighing on businesses.
“Recession risks loom, and the Bank of England may need to cut rates in February to support activity, despite inflation concerns.”
SMALL WINS
Some businesses reported pockets of resilience. Emma Jones, Managing Director at Whenthebanksaysno.co.uk, observed: “For us, it was business as usual through the end of 2024.
“The Budget has put pressure on completions by March, but I’m confident momentum will continue from April onwards. People are adapting to uncertainty and moving forward.”
And Natalie Ormond, Owner of Smallkind, shared a surprising uptick in sales: “Orders in November and December were up 50% compared to the previous year.
“While this boost was much needed, it doesn’t leave us in the strong position we’d hoped for after a tough year.
“Consumer behavior has become increasingly unpredictable.”
RADICAL ACTION
Other experts emphasized the need for bold measures. Graham Cox, Director at Bridging Hub, commented: “The economy is stuck in a stagflationary doom loop.
“Radical measures, such as overhauling the planning system and leveraging AI, are essential. But in the short term, the picture remains grim.”
And Craig Fish, Director at Lodestone Mortgages & Protection, added: “With no real growth and no plan from the Chancellor, the pressure is on the MPC to make critical decisions.
“Unfortunately, their toolbox is limited.”
GLOOMY OUTLOOK
Tony Redondo, Founder of Cosmos Currency Exchange, summarized the broader sentiment: “The UK economy eked out 0.1% growth in November, falling short of economists’ expectations.
With government borrowing costs at multi-decade highs and unresolved fiscal challenges, the Bank of England faces a difficult decision between supporting growth and controlling inflation.
“The stakes are high as the UK navigates these turbulent economic waters.”
As the UK enters 2025, the latest data reveals an economy struggling to find its footing.
“While some sectors and businesses show resilience, the broader landscape remains one of stagnation, uncertainty and a pressing need for transformative policy interventions.”
