Firms need concrete plan as economy shrinks by 0.3 per cent - Chamber

The UK economy unexpectedly shrank in August for the first time in two months, new figures reveal today.

According to the Office for National Statistics (ONS), the economy contracted by 0.3 per cent on the previous month.

The growth experienced in July has also been revised downwards, from the 0.2 per cent previously recorded to just 0.1 per cent.

The drop in the monthly figure for August was driven by a sharp decline in manufacturing and maintenance work, which slowed down the oil and gas sector, the ONS said.

Raj Kandola (pictured), head of policy at Greater Birmingham Chambers of Commerce, said: “Despite the volatility usually associated with monthly economic projections, this morning 's GDP figures will simply add to the air of uncertainty we are currently facing.

“As data from our latest Quarterly Business Report reveals, business are struggling with a range of challenges across recruitment, supply chain disruption and grappling with rising inflation and interest rates.

“With fiscal and monetary policy seemingly pulling in opposite directions firms will need to see a concrete plan from the government that will calm the financial markets and offer businesses a degree of confidence to plan ahead for the coming months. ”