Growth will be stronger than expected in 2011
This is according to the chief executive of professional and financial services organisation pro.manchester, who also said that the private sector is set to create the job growth to offset spending cuts.
Every 1% growth in GDP will lead to the creation of around 100,000 jobs according to the research, and growth should be above trend in the recovery process.
In the first of planned quarterly economic reviews, John Ashcroft has analysed the world economic recovery and the implications this has for the UK and North West. The first report will be published in February but a summary of the forecasts is now being revealed.
Having looked at a range of economic measures including UK main forecasts, GDP data and employment, public sector net borrowing, inflation, export and import figures and interest rates – John has pulled together a comprehensive report of what we should expect during the next 12 months.
As well as predicting GDP growth will be stronger than suggested, he believes manufacturing and business investment will lead the expansion with exports also enjoying strong growth.
He said: “There will be winners this year with new technologies such as digital media and creative as well as clean tech and green tech sectors providing growth.
“Manufacturing is leading the recovery. The service sector, professional services and the property rental market will flourish alongside export, retail and e-commerce.
“There will be inevitable losers in 2011, the housing market will create problems in related retail sectors, inflation will remain above target and interest rates are set to rise.”
John has identified a number of market challenges ahead, such as the oil price, commodity prices and currency tensions between the Dollar, Renminbi and the Euro but believes there are reasons to remain optimistic about 2011.
The quarterly economic reviews are one of the new initiatives launched by pro.manchester for 2011/2012. Data sources for this report include the National Institute of Economic and Social Research, International Monetary Fund, the Organisation for Economic Co-operation and Development, Netherlands Bureau for Economic Policy Analysis, Office for Budget Responsibility, Deloitte, PwC, UK Treasury and Greater Manchester Forecasting model.