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So, today we “officially” moved out of recession. The economy grew by 0.1% in the last quarter of 2009, the Office of National Statistics announced today, meaning that the 18-month recession – the worst since the 1930s – is officially over.
However, despite the good news, it is still too early to hang out the bunting and start assuming that your customer’s basket-spends will rise straight away. The 0.1 % growth was much lower than the 0.3% that the Government had predicted, and leading economists, city analysts and senior figures in retailing are talking about the risk of a “double-dip” recession with some authority.
The impact of further economic turmoil for small businesses could be deep. The Federation of Small Businesses, reacting to the announcement, has asked the Government to reconsider its plans to increase employer National Insurance contributions and to stress the importance of access to affordable finance and credit for small businesses.
The sort of reassurances that these moves would provide to small businesses would help restore confidence before the General Election, which is widely believed to be taking place on May 6. And it’s this confidence that consumers and retailers need as we move further into the New Year. The recession may be “officially” over, but it will take much more time before consumers are as confident with their cash as they were before the crash began in 2008.
Today’s news can be greeted with a small cheer – but the horizon isn’t entirely clear yet. The hard work for the continually hard-working smaller retailers continues unabated.
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