Leading business groups have called on the newly elected Labour government to make economic growth their top priority.
Key organisations like the Confederation of British Industry (CBI) and British Chambers of Commerce (BCC) highlight the need for decisive action to attract investment and support UK businesses.
New Initiatives for Economic Growth
In his inaugural press conference as Prime Minister on Saturday, Keir Starmer committed to chairing new “mission delivery boards” to “drive through change” and fulfil Labour’s manifesto promises.
These include boosting economic growth, investing in clean energy, and enhancing opportunities through a revised skills agenda.
Business Community’s Expectations
Louise Hellem, Chief Economist at the Confederation of British Industry (CBI), commented: “Businesses view the general election results and the clear mandate given to the new government as a pivotal moment for the economy.
The government must hit the ground running and remain steadfast in delivering growth. Early tough decisions are crucial to attracting investment, seizing growth opportunities, and enhancing our appeal to global investors.”
The CBI’s latest survey indicates solid growth in financial services in the second quarter, following a robust rebound in the first three months. Financial firms anticipate even faster growth in the next quarter.
Increased Business Confidence
Further positive economic news coinciding with Starmer’s premiership was reflected in other surveys.
The British Chambers of Commerce (BCC) reported increased business confidence in the second quarter, with 58% of firms expecting higher turnover in the next 12 months.
Their quarterly survey revealed that business conditions are returning to pre-pandemic levels, especially in sales and cashflow.
Calls for a Long-term Economic Plan
Shevaun Haviland, BCC Director General, emphasised: “Our message to the new government is clear. We need a long-term economic plan centred on the green transition, a future-ready workforce, thriving local communities, and globally competitive, digitally enabled businesses.
The business community is ready to collaborate with the government to capitalise on the positive trends indicated by our data.”
UK Labour Market Developments
A separate survey, the UK Report on Jobs by KPMG and the Recruitment and Employment Confederation (REC), noted the fastest rise in permanent pay in eight months.
Neil Carberry, REC Chief Executive, stated: “The incoming government has underscored growth and prosperity as core goals.
However, achieving these requires a partnership with businesses.
Ensuring the new deal for workers is implemented in a business-friendly manner that supports necessary agility for both workers and employers is crucial.”
National Wealth Fund Initiative
These supportive statements and calls for private sector partnerships come as former Bank of England Governor, Mark Carney, prepares to report to the Treasury on creating a national wealth fund.
Carney, who served as Governor from 2013 to 2020, leads a task force advising Chancellor Rachel Reeves, with findings expected on Tuesday.
The national wealth fund, a significant component of Labour’s economic stimulus and climate crisis strategy, aims to invest £7.3bn over the parliamentary term.
This includes £1.8bn for ports, £1.5bn for gigafactories, £2.5bn for clean steel, £1bn for carbon capture, and £500m for green hydrogen.
Job Creation and Economic Impact
Despite criticism over its size and investment scope, the fund aims to attract three times its investment in private capital.
Labour asserts that, alongside home insulation plans, the wealth fund will help create over 650,000 jobs in sectors such as electricals, plumbing, and engineering.
The call for action is clear – prioritise economic growth to ensure a prosperous future.
With strong backing from the business community, the new Labour government has the opportunity to foster a thriving economy.