Despite the delay on the lifting of all lockdown restrictions for another month, the UK economy is set to bounce back to its pre-COVID level towards the end of 2021, according to the latest figures from the Confederation of British Industry (CBI).
The latest CBI Economic Forecast shows that the easing of some COVID-19 restrictions, rapid roll-out of vaccines and the unleashing of pent-up demand means the economy is poised for growth over the summer.
However, this recovery will not be felt as strongly by those sectors still working under restrictions.
The CBI is forecasting GDP growth of 8.2% this year, and 6.1% in 2022 following a historically large fall of 9.9% in output over 2020.
Business investment nonetheless remains 5% below its pre-COVID level at the end of 2022, reflecting both the scale of the decline seen over the crisis, and lingering uncertainty.
CBI Director-General, Tony Danker, said: ‘The imperative now must be to seize the moment to channel this investment into the big drivers of long-term UK prosperity. That’s why it’s the right time for government to come forward with far more detailed plans on everything from decarbonisation, to innovation to levelling up.
‘Clearly this does not apply to the hardest hit sectors from the pandemic who even now face continued delays and genuine challenges to stay viable. Extending the commercial rent moratorium will help keep some firms’ heads above water, but the government must also do the same on business rates relief.’