ONS blip fuels business uncertainty

Speculation is rife as to the true reason why the Office for National Statistics has delayed publication of the latest GDP figures, originally due out today, Wednesday. The ONS postponed release of the stats, traditionally viewed as one of the most reliable economic indicators, after the statistical agency admitted to finding ‘potential errors’ in its data.

The question mark over the reliability of the stats means that they won’t be published until a fortnight after their due date. But the question is, were the figures generated by the body incredibly good or incredibly bad?

One thing’s for sure, we may be entering a period of relative stability in some respects -- the coalition government is starting to bed in, the emergency Budget has been presented – but the reality is that widespread business confidence across UK plc is still a long way off.

A survey published just this week by recruiter Robert Half highlighted distinct unease among finance chiefs, with three quarters of respondents saying they were concerned about the economic prospects facing the UK over the next six months.

Less than a quarter (22%) of finance leaders feeling more or slightly more confident about the economic prospects facing their company in the next six months, according to the ‘Robert Half CFO Confidence Index’, representing a 25-point decline in confidence levels since January.

The UK’s finance directors may not be feeling very upbeat about economic prospects, no doubt swayed by government rhetoric about the sacrifices we will all have to make to bring the public deficit under control.

But it’s not all bad news according to the study, which finds that 80% plan on either increasing or maintaining permanent accounting and finance staff headcount in the second half of this year. That figure rises to 84% among larger companies.

Of course this is just one snapshot of countless numbers being published, and for every bad news story, there’s another promising an improvement in the business outlook. The danger is that ay feelings of confidence could be short-lived without investment to support them.

Reports that the coalition government will set new lending targets for the partially state-owned banks in a bid to improve the flow of credit to small and medium-sized businesses can only be good news in that respect.