Business News Round Up (03/05/2024)
UK will be worst-performing G7 economy in 2025, OECD forecasts
The UK will be the worst performing G7 economy next year as high interest rates and restrictive fiscal policy hampers medium to long-term economic growth, the Organisation for Economic Cooperation and Development (OECD) has predicted. In its annual assessment of the UK economy, published Thursday, the OECD slashed its UK growth outlook for GDP to 0.4% this year and 1% in 2025. This is down from 0.7% and 1.2% respectively from its last prediction in March. As such, the predictions show the UK is set to be the slowest growing economy in the G7 group of countries next year and the second worst this year, behind Germany. The outlook is a blow to Prime Minister Rishi Sunak and his Chancellor Jeremy Hunt, who have routinely claimed that the UK economy has turned a corner, despite the country going into a “technical” recession in the final quarter of 2023.
https://www.politico.eu/article/uk-will-be-worst-performing-g7-economy-in-2025-oecd-forecasts/
Weak footfall prompts plea for coherence from next first minister
Scottish footfall decreased by 3.6% year-on-year in April, down from -0.9% in March. The latest Scottish Retail Consortium and Sensormatic Solutions data also showed that for March and April together, total Scottish footfall decreased by 2.2% year-on-year. Shopping centre footfall also fell, by 4.7% in April year-on-year – 3.5 percentage points worse than March. However, footfall in Edinburgh rose by 2.3% year-on-year in April, while in Glasgow it fell by 5.7%. David Lonsdale, director of the Scottish Retail Consortium, pointed out that visits to Scottish stores fell for a seventh consecutive month in April. “This comes at a tricky time for many stores with business rates bills landing firmly on doorsteps – 4,500 Scottish shops have just seen an extra £31m added to their annual rates bills, a cause for concern given the weakness in revenues from shoppers.”
https://www.insider.co.uk/news/weak-footfall-prompts-plea-coherence-32720559
Foreign Direct Investment: UK’s project total grows as Europe’s falls
The UK remains second in EY’s annual ranking of European countries by their ability to attract Foreign Direct Investment (FDI) projects and was the only country in the top three to see project numbers increase year-on-year. France ranked first in Europe for the fifth consecutive year, while Germany followed in third place, according to the EY 2024 UK Attractiveness Survey. The UK was home to 985 FDI projects in 2023, which was a 6% increase from 2022. Europe as a whole recorded a 4% year-on-year decline with a total of 5,694 projects recorded in 2023. This was the continent’s lowest FDI total since 2020 and was 11% lower than its pre-pandemic level (6,412) and 14% lower than 2017 (6,653). 2017 represented Europe’s highest peak for projects in the last decade. France was Europe’s largest recipient of inward investment, recording 1,194 FDI projects in 2023, a 5% decrease compared to 2022.
https://www.ey.com/en_uk/news/2024/05/uk-foreign-direct-investment-project-total-grows
Two-thirds of employees now have flexible working, new research reveals
Two-thirds of workers in Scotland are now benefiting from flexible working, new research has shown, compared to less than half of employees pre-pandemic. New figures contained in a report by social business Flexibility Works showed 67% of workers in Scotland now have some form of flexible working, up from 61% last year and 46% pre-Covid. The research, revealed in the firm’s Flex for Life 2024 report, showed about two-fifths (43%) of business leaders and senior managers agreed that greater flexibility in the workplace is being held up by opposition from their peers and senior colleagues. With 71% of employers believing such practices have benefits for their business – and with more than three-quarters (77%) of those who work flexibly saying they are happier with their work-life balance as a result – the Scottish Government’s fair work minister Gillian Martin said all bosses should look at their practices.