IAB chairman offers up grim economic forecast
- IAB chairman Clive Johnson has predicted that the current economic downturn will last for up to two years.
- AccountingWEB.co.uk’s economy poll backs up Johnson’s analysis with two-thirds of members thinking that economic trading conditions in 2011 will remain stagnant.
- There are warnings of an inflation spike as firms plan to take advantage of the rise in VAT in the New Year.
International Association of Bookkeepers (IAB) chairman Clive Johnson this week predicted that the current economic downturn will last for up to two years.
Johnson’s comments are broadly in line with many major economic forecasters as well as reflecting what businesses are experiencing at the ground level.
“We hear from insolvency practitioners that the numbers of business failures are going down, but that’s based on what my clients and their books are telling me, that’s not my experience,” said the IAB chairman and principal of KC & Co in Coventry on Monday. “Cash flows are still down and they’re not getting better.”
AccountingWEB.co.uk’s Economic Outlook poll backs up Johnson’s grim analysis with two-thirds of members polled during late November and early December thinking that economic trading conditions in 2011 will remain fairly stagnant without any appreciable movement.
The poll also uncovers a degree of uncertainty in the year ahead with 21% thinking it will worsen considerably and just 13% predicting a significant improvement in 2011 – mirroring the downbeat forecast from the Office of Budget Responsibility on 9 December.
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