10.01.201802:14:00UTC+00UK Economy Set for ‘Underwhelming’ Year - British Chambers of Commerce

The U.K. economy appears set for an underwhelming 2018, according to a major survey, which showed businesses in a subdued mood ahead of Brexit.

Companies are dealing with cost pressures in the last three months of 2017 and are reluctant to invest further, the British Chambers of Commerce's (BCC) Quarterly Economic Survey showed.

The service sector grew at a subdued pace, the BBC said. Manufacturers were doing better than services companies, but still reported a slowdown in domestic and export sales.

Overall the survey implied that the economy expanded modestly at the end of 2017, after accelerating marginally in the three months to September with quarterly growth of 0.4 percent - below a record trend of nearer 0.6 percent.

The survey of 7,000 firms - the biggest of its type - showed the proportion of services companies reporting recruitment difficulties have increased to 71 percent, the highest since records started in 1989.

The BCC cautioned that this could prove to be the largest impediment on businesses this year, and advised its members to train more staff, instead of complaining about staff shortages.

More than a third of services companies are expected to increase prices over the next three months, the most since late 2008.