UK drinking its way to economic recovery

Consumer spending in the UK’s services sector has seen the biggest leap in nearly six years as hotels, bars and restaurants received a much needed boost, according to new figures from the CBI.

Trade across hotels, bars, restaurants and travel and leisure firms rose at the fastest pace since August 2007.

According to the CBI’s quarterly services sector survey, output from the services sector, which accounts for around 77% of the wider economy, improved in the three months to May. The boost was led by a sharp turnaround from consumer-facing businesses, which offset stalling progress among business and professional firms.

Stephen Gifford, director of economics at the CBI, said: “There appears to be a sense of growing confidence in the service sector. We’ve seen some turnaround in activity this quarter, and a more positive outlook for the next.

“What’s promising is that consumer services have seen growth in activity, and expect this to continue pointing to a greater willingness from people to go out and spend.”

The improvements in the services sector helped Britain avoid a triple-dip recession, with growth of 0.6% spurring on a 0.3% rise in overall gross domestic product (GDP) in the first quarter.