The UK economy grew by 0.5% in the third quarter of 2011, according to the latest data from the Office for National Statistics.Many experts had been expecting some improvement on the poor second quarter growth figure (0.1%), but growth in the July-to-September period outstripped the consensus forecast of 0.4%.
The chancellor, George Osborne, described the growth figures as a "positive step forward," and told Sky News that the government was "laying the foundations for the future success of the country."
Mr Osborne's optimism, however, was not shared by the shadow chancellor. Said Ed Balls, "growth of just 0.5% over the past year since the chancellor's spending review – compared to 1.6% in the US – is a significant slowdown from the 2.6% we saw in the previous twelve months."
Dr John Philpott, the chief economic adviser at the Chartered Institute of Personnel and Development, urged caution over the growth figure, saying that it "barely amounts to an economic recovery."
Said Dr Philpott, "Growth at this rate is not only too weak to stem the rise in unemployment but increases the likelihood of a 'job loss recovery'... where the economy expands but not by enough to prevent private sector employers from laying off staff."Even more worrying, however, is the possibility that the third quarter growth rate is the best we will see until the middle of 2012. Growth in the third quarter was still being supported by an expanding government sector. As this expansion wanes under the pressure of fiscal austerity, and with considerable uncertainty about the prospects for export sectors and consumer services sectors, the chances are that growth will be slower for at least the next two quarters."