Accountants report business confidence sliding in all sectors, but predict no recession

UK business confidence is falling rapidly, with construction and property among the sectors worst affected, according to a recent report by the Institute of Chartered Accountants in England & Wales (ICAEW).

Its Business Confidence Monitor showed a fall in construction confidence to minus 24.2 in the first quarter of 2008. In the property industry, confidence has fallen to the lowest level ever recorded for any sector, sinking to minus 47.0.

The overall level of business confidence across the UK economy is now minus 19.7, down from minus 7.2 in the previous quarter, compared with a cyclical peak of plus 11.5 a year earlier.

The ICAEW said that firms of all sizes, in all sectors and across all regions, are now being affected by the economic slowdown. Despite this, it predicted that there will be no recession.

Michael Izza, ICAEW chief executive officer, said that while nowhere is immune, growth is still predicted for the overall economy.

The Business Confidence Monitor figures are based on responses from 1,036 chartered accountants in England, Wales and Scotland.