UK economy shrinks in September as JLR cyber-attack stifles production

UK economy growth has slowed to 0.1 per cent in the three months to September, according to the Office for National Statistics (ONS).

The figures also show the impact caused by the Jaguar Land Rover cyber-attack, after the five-week shutdown drove car production down by more than a quarter.

But business leaders in Greater Birmingham said that high labour costs and utility costs for businesses were also a factor in the sluggish growth.

Emily Stubbs (pictured), Greater Birmingham Chambers of Commerce head of policy, said: "As the largest automotive manufacturer in the country, the cyber-attack on Jaguar Land Rover over the summer and its subsequent shutdown contributed to a 0.5 per cent contraction in production output in Q3's GDP figures.

"This counteracted 0.2 per cent growth in services and 0.1 per cent growth in construction.

"Research by the Chambers demonstrated the acute concentration of the crisis in the West Midlands, where JLR is a cornerstone employer, and the scale of the impact on both supply chain and ancillary firms.

"Nevertheless, even accounting for the JLR shutdown, economic growth has been lacklustre.

"This is unfortunately unsurprising.

"Our Q3 Quarterly Business Report survey found that labour costs - particularly as a result of employer national insurance increases - and utility costs are impacting profitability and cashflow for Greater Birmingham businesses, constraining hiring intentions and business investment.

"At a national level, the picture is similar: decisions made at the last Autumn Budget have contributed to weak business and investment confidence.

"The Chancellor has warned of the difficult decisions to be made in her upcoming budget, but the data is clear - if growth is the Government's number one mission, piling further cost pressures on businesses is not the way to go.

"The economy will continue to struggle unless these cost pressures are alleviated and the right tools are put in place to help firms invest, recruit and trade.

"There must be no more taxes on businesses in this year's budget."

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