Economic growth of 2.5% predicted for 2014
In a boost for companies across the UK, economic growth of 2.5% is predicted for the coming year.
According to the National Institute of Social and Economic Research, 2015 will also see growth, with the recovery firmly “entrenched”.
The estimates are broadly in line with existing predictions, while unemployment is also expected to fall below 7% before the end of the year.
The news of the recovery will be particularly pleasing to those companies who have struggled financially throughout the economic crisis.
While many have faced company administration and insolvency, others have sought business rescue and can now benefit as a result.
The International Monetary Fund and the Organisation for Economic Co-operation and Development both made similar predictions in January.
Recovery signs from the most troubled sectors
There is an increasing air of optimism surrounding the economy, as falling unemployment and rising house prices prompted increased customer spending.
Meanwhile, some of the hardest hit sectors, such as construction, are also showing signs of recovery.
That isn’t to say that concerns don’t still exist though, as many prices continue to rise faster than many salaries due to sluggish wage growth.
“The UK's economic recovery is entrenched,” the NIESR said in a statement.
“We expect consumer spending to remain the key driver of recovery in 2014 and 2015, supported by continued buoyancy in the housing market.”
With the Bank of England recently opting to maintain its benchmark interest rate of 0.5%, the expectation is that the recovery must be sustained for at least a year prior to any major change.
The initial signs are positive nonetheless, and business confidence also appears to be on the up, suggesting that for many businesses the toughest times could now be behind them.
However, business restructuring could remain a possibility as altering how a business is run can save considerable sums in the long term if carried out properly.
By Phil Smith