Private sector businesses experienced a strong end to 2015, especially those in the business and professional services sectors, although manufacturers and exporters had a more difficult December.
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A survey of 766 businesses by the CBI, one of the UK’s largest business groups, revealed that the balance reporting rising output was +20%, much higher than the +13% registered in November.
It was also leagues above the long term average of +5%, said the CBI.
The group added that growth was “improving” and that business services had acted as a “lightning rod for growth”.
Retail and wholesale sectors recovered well from a patchy performance in previous months, boosted by the legacy of Black Friday which took place at the end of November.
Overall, the economy is expected to maintain the strong growth rate for the next three months. But the CBI warned that “global challenges remain” and “there is no room for complacency”.
Many emerging markets are facing a testing time, with China moving to a slower growth path and other emerging economies being buffeted by low commodity prices, capital outflows and currency depreciation.
“The picture differs markedly by sector,” said Carolyn Fairbairn, the organisation’s director general.
“Manufacturers are having a tough time, with the strength of sterling hitting their competitiveness in the Eurozone and the slowdown in emerging markets weighing on export demand. And the North Sea industry and its suppliers are feeling the impact of falling global oil prices.”
“Employers want relief from the cumulative burden that could harm the UK’s competitiveness, as the combined effect of the introduction of the apprenticeship levy and the national living wage begins to bite against the backdrop of unreformed business rates and the administrative challenge of pensions enrolment.”