Where is the economy heading, and can enterprise change the story?

CREATED BY ROGER EDDOWES Published: 09/03/2026 @ 09:00AM #EconomicCommentary #Growth #Confidence #Businesses #FutureOutlook

When I look at the latest economic commentary and data, my honest feeling is that the economy is in a strange place right now. It is not collapsing, but it is hardly thriving either. Growth has been slow, confidence feels fragile, and many businesses are still trying to work out what the next few years might actually look like ...

Where is the economy heading? A path uncertain, Towards growth or decline?

Recent figures show that the economy only grew by around 0.1% in the final quarter of last year, which is hardly the kind of momentum anyone would describe as strong. When I see numbers like that, it reinforces my view that the economy is effectively treading water. We are not moving backwards dramatically, but we are not accelerating forward either.

Slow growth over a long period quietly erodes
living standards and business confidence!

What concerns me even more is the broader environment in which that slow growth is happening. Businesses are already dealing with higher costs, cautious consumers and uncertain policy decisions. Now we also have fresh geopolitical tensions to contend with.

The conflict in the Middle East is creating volatility in energy markets again, and whenever oil and gas prices rise, it has a habit of feeding back into inflation and business costs. From my perspective, that is exactly the kind of external shock the economy does not need.

When I step back and look at the bigger picture, my view is that the economy is still in a recovery phase, but it is a very slow and uneven one. Some sectors are holding up reasonably well, but others are clearly struggling. The challenge is that uncertainty makes businesses hesitant to invest, and without investment, it becomes very difficult to generate the productivity and growth the economy needs.

Yet, I do not think the outlook is entirely bleak!

In fact, one of the more interesting ideas I have seen recently comes from a group of entrepreneurs who are pushing back against what they call Britain's 'doom loop' narrative. Their argument is that the country risks talking itself into decline, which then becomes a self-fulfilling prophecy.

A new initiative called Enterprise Britain, led by well-known entrepreneurs including Brent Hoberman and Stephen Fitzpatrick, is trying to challenge that narrative and push for a more ambitious economic strategy. Their message is essentially that Britain still has enormous strengths, but that growth will only happen if the environment encourages businesses to build, invest and scale.

Personally, I find that argument quite compelling. When I think about what really drives economic growth, it usually comes back to businesses creating value, employing people and developing new ideas. If the policy environment makes that harder rather than easier, growth inevitably slows.

The entrepreneurs behind this campaign have suggested a range of reforms aimed at improving the investment climate and encouraging more people to benefit from business success. Their proposals include things like tax changes to encourage investment, encouraging pension funds to back British companies and removing barriers that make it harder for businesses to grow.

My own view is that the most important part of this conversation is confidence. Economies do not just run on numbers and statistics; they run on belief in the future. If entrepreneurs, investors and business owners believe the UK is a good place to build companies, growth tends to follow. If that confidence disappears, the opposite happens.

Is the United Kingdom at a crossroads?

On one hand, there are genuine economic challenges, from slow growth to global instability and rising geopolitical tensions. On the other hand, the country still has strong institutions, a deep financial sector and a history of innovation and entrepreneurship.

Ultimately, my sense is that the direction of the UK economy will depend less on the short-term data and more on the choices made over the next few years. If policymakers focus on stability and growth while creating an environment where businesses can thrive, the current period could become a turning point. If not, the slow-growth cycle may continue.

The challenges are real, but so is the potential. And if there is one thing I have learned from watching the economy over my years as an accountant, it is that confidence, ambition and enterprise often play a bigger role in shaping the future than the headlines of any single year.

For now, I remain cautiously optimistic.

Until next time ...

ROGER EDDOWES
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About Roger Eddowes ...
Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach. Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.

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