The UK service sector has consistently outperformed its major economic rivals abroad and is fundamental to the nation’s ongoing prosperity, a new report has shown.
A report analysing the UK services sector over the past 20 years, compiled by the Ernst & Young ITEM Club, found that financial and business services now employ more staff than manufacturing in nearly every region in the UK.
Furthermore, the report largely attributes the UK’s continued economic success and 59 consecutive quarters of GDP growth to the services sector.
Commenting on the findings, Mark Otty, chairman of Ernst & Young, said, “The services sector has been driving the unparalleled performance of the UK economy over the last decade or more.
“It is the key to the UK’s future prosperity.”
Peter Spencer, chief economic advisor to the Ernst & Young ITEM Club, added: “Output in the service sector has risen by over 3% a year on average since 1997 which is a remarkable achievement.”
The report predicts growth of 4% per annum in the financial and business services sector over the rest of this decade, but warns that this success should not be taken for granted.
“We need to continue to invest in the skills and training of our workforce to make sure that the UK remains competitive and we need to ensure that our sometimes ageing infrastructure is improved,” added Spencer.
“There are huge opportunities for UK services in India and particularly in China as those markets become more open and their customers become wealthier.
“But, no one should be in any doubt that as the service sector in India becomes more sophisticated their companies will take on the UK service sector both in India and here.”
© Crimson Business Ltd. 2007
