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Next year 'likely to be tough for firms'

Businesses across the UK could be set for a tough 12 months ahead, it has been argued.

George Derbyshire, chief executive of NFEA - the national enterprise network, said despite a number of indications that there is a positive outlook for 2010, companies may be feeling the pinch again next year due to caution in the run up to the General Election.

He commented: "I do have concerns about next year, because confidence needs to be maintained and needs to be translated into real economic performance."

According to a forecast from the Confederation of British Industry, the UK economy is expected to exit the recession in the fourth quarter of 2009.

Thereafter growth will remain subdued and GDP is unlikely to have reached pre-recession levels by the end of 2011, the CBI said.

It predicted subsequent growth in the first two quarters of 2010 will be weak at 0.3 per cent, but this should strengthen as the global economic recovery gathers pace, businesses rebuild stocks and household spending recovers.