For instance, what the future trading relationship between the UK and EU will look like and whether there is any long-term reputational damage to the UK. Several of these risks relate to the ongoing uncertainty around the impact of the Brexit process. There are risks to our forecasts, however. However, a number of other sectors of London’s economy are expected not to experience any significant growth such as Distribution, accommodation and food service activities (Figure 4) or see falls such as Transport and storage which sees declines in all three years, and Manufacturing which we expect to see declines in 20. We expect the fastest overall rates of output growth to be in the Financial and business services industry between 20 (Figure 3). Our forecasts are also available by broad industry group. That said, our forecasts generally follow the same underlying trends of subdued GVA growth and relatively slow jobs growth. Generally, our forecasts for GVA are within the range of independent forecasters (Figure 1), though lower when looking at workforce jobs (Figure 2). We can also compare our forecasts for London with those from independent and external organisations. Anecdotally, these business surveys suggested that the uncertainty caused by Brexit has dampened some business investment among other business decisions. For example, business surveys like the Purchasing Managers’ Index (PMI) have rebounded from their post-referendum falls, but they point to growth which is at a more moderate level. This can be partly linked to the continued uncertainty caused by the UK’s decision to leave the European Union (EU). Putting these forecasts in the context of historic data (see Figures 1 and 2), we can see that the forecasted rates of growth for output and employment are more subdued than previous years. That said, the rates of growth are expected to be slow by historical standards. Household income and spending are expected to also grow over the three-year forecast period after accounting for inflation.We then expect the rate of employment growth to slow to 0.3% in 2019 before rebounding to 0.7% in 2020. The number of jobs is expected to increase 0.6% in 2018.This rate of real GVA growth is then expected to increase slightly in 2019 to 1.9%, before picking up to 2.2% in 2020. London’s economy is expected to grow by 1.6% in 2018 in real terms (i.e.This uses our bespoke forecasting model to estimate London’s economic output (as measured by gross value added or GVA), workforce jobs, household income and household spending up to 2020. GLA Economics has recently published its latest economic forecasts for London.
GLA Economics forecasts subdued economic growth for London
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