How sustainable is Britain's economic growth?
Richard Edgar
Former Economics Editor
The economy grew last year at its fastest pace since 2007, before the financial crisis began. It expanded 1.9 per cent in 2013, helped by growth of 0.7 per cent in the last three months of the year.
By far the biggest contributor to growth was the service sector which contributed 0.61 percentage points of the overall 0.7% growth. Industrial production added 0.1 percentage points - small, but there is a recovery amongst manufacturers.
Finally, the small but very newsworthy construction sector let the side down somewhat, shrinking in the last three months of 2013 and knocking 0.02 percentage points off the overall figure.
Alan Clarke, an economist at ScotiaBank, blames a shortage of bricks ... which I suppose is good news in a roundabout way.
The big question is how sustainable this growth is. Although the data today only represents what the economy produced, we know that the other side, spending, is showing some troubling signs.
Consumers spending is reflected in some of the service sector growth and that has been fuelled by a fall in savings. Furthermore, although there are hints it is improving, business investment has been very weak, as companies held back from spending on new equipment until they're sure the recovery is underway.
One reason exporting companies have been hesitant is that spending in their markets in Europe has been very weak. Britain is still importing more than it exports and that will be very hard to reverse
There are many clues that the economy will continue to grow this year. The CBI, which represents companies, says surveys of its members suggest "robust output growth" well into the Spring.
But the TUC says this is the wrong kind of recovery, which: “Is yet to reach whole swathes of the country or feed into people’s pay packets."
Ultimately that will be the worry for the Chancellor and the government as the next election looms into view.