Economy

According to an industry group, UK retailers have seen the biggest annual decline in prices since 2006. In June prices across products such as furniture, cloths, electronic good and even supermarkets have seen large price reductions.It is reported by The British Retail Consortium that prices have fallen by 1.8% in the last month when compared to the same month a year earlier. This is the biggest price fall since the survey has begun.The only sector that was higher was food, with a 0.6% price increase, non food prices had fallen by 3.4% which is another record. The driving factor is said to be the high competition between retailers and supermarkets. Food inflation levels are at a record low, which means its not costing as much to import food helping to keep relative costs down.The supermarkets are leading a price war with many of the competition trying to gain large percentage shares within this market sector. Tesco has reported its largest drop in quarterly sales in over 40 years, leading to further speculation over more aggressive price cuts.Consumer inflation has also fallen to a four and a half year low, to just 1.5% in May. Consumer inflation is the measure of the cost of consumable products across a selection of items. The Bank of England is forecasting that inflation should be near 2% over the next two to three years.The main benefactor is the British public as they are really seeing the benefits of low cost consumables.yourvirtualofficelondon.co.uk is also helping to keep inflation down, we have a price freeze with all current online services. If you need any help or assistance do get in contact with us today. If you found this blog interesting, you can read our latest blog posts here.

A report has come out that suggest almost half of all UK company managers are working an extra full day in unpaid overtime every week.The report explains that access to emails after work through smartphones and constant work pressure relates to over 90% of managers working outside their normal working day.The report goes onto state that around 13% of managers work an extra 2 days per week in unpaid overtime. The CBI, a Business lobby group has confirmed many UK businesses are addressing the issue of work pressures which is relating to managers feeling they are needed to work extra hours.Two thirds of company manages feel pressure to work the extra hours, the institute of Leadership and Management has reported.The hours are being spent on lunch breaks, early mornings and after hours in the evening. When you look at the amount of extra work carried out it really does add up.It has always been standard practice for manages to work extra hours when the business is really under strain, but excessive hours are not sustainable and not good for staff health or morale. Decisions can start to be affected which will lead to a break down in performance.A survey conducted on-line found that over 76% would regularly work late from home or at the office, and a further 48% would consistently work through their lunch break. This can be directly attributed to smartphone technology, which has helped access to work emails after hours, lunch breaks and even before work on the commute.

Counter productive

Working hours far in excess of the normal working week can really leave its toll on you. Employee burnout can lead to increased stress and further health complication such as depression and even physical sickness.Smartphones can help benefit employees from flexible working, allowing them to reduce the work in the office and giving them flexibility to work from home which can lead to reduced stress. This can then have a real positive affect on the staff which can lead to increased business profits.This blog post was produced by Robert Carter, Digital Manager from Your Virtual Office London.

The UK is to become the second largest economy by 2020, overtaking France. This is according to a consultancy firm PwC.PwC have said this is due to the strength of the pound against the dollar, when compared to the strength of the Euro to the dollar. The strong currency combined with continued falling unemployment is adding the economy`s growth.Germany is still forecasted to be the top economy in Europe, the US is top globally followed by China, Japan and then Germany.But it says the UK lags behind in areas including education, investment, trade deficits and income inequality.India`s economy is set to overtake the UK by 2030, this will also rise above Germany and Japans to become ranked third largest economy in the world.The UK`s economy is estimated to be worth £1.65 trillion while the French economy is valued at £1.60 million. The consultancy has noted that the UK has strengths in political, legal and regulatory institution. This also includes easing of doing business and strong communications technology. They also suggested that the UK scores well with relatively low unemployment rates and good inflation performance.

Why start a business?

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Online banking transactions now consistently hit over £1 billion a day a study has shown.The study does not show the percentage of transactions made on phones, tablets or PC`s, but the rise is probably due to the increase in mobile banking and the rise of new apps to aid this.The research shows that over 15,000 online banking applications have been downloaded every day. This total`s over 14.7 million bank applications have now been downloaded.The report does also show that many people still prefer online internet banking as opposed to mobile phones, especially when large transactions are involved.The rise of online banking, including mobile and internet has ultimately led to a fall in the use of bank branches. However people still like to use the branch for important moments such as mortgages and financial advice.

Business Banking

Business banking has also seen a large increase of its customers using applications to aid with the running of the business. Your Virtual Office London can help get you a business bank account with Barclay's. We are able to fast track your application and this is all totally free, just another great service we provide to all our clients. If you need advice or help do not hesitate to contact us today.

UK house prices have risen at their fastest pace in over seven years; this is according to information provided by Nationwide. Many are now worrying about a housing bubble which could burst due to many first time buyers being priced out of the market.Bank of England Governor Mark Carney has already warned the housing market is a very big risk that could damage the UK`s recovery. The main reason is the lack of new home building; it is thought the Bank of England will try to curb the growth by increasing measures to control mortgage lending.Demand for homes will continue to be strong, with the economy growing at its fastest rate combined to new job creation and businesses starting to perform well will increase the demand for properties over the next term.

Update: June 2016

House prices: Eurozone buyers looking to snap up Brexit-boosted bargains.According to a news report from The Week.co.uk, the uncertainty over the referendum has caused the pound to fluctuate, which means buyers from the single currency EU zone have saved an average £26,000 when buying up London properties.Bargains are to be had and European buyers are rushing to snap them up quickly. According to the Office of National Statistics, average house prices in London currently stands at around €596,900. However, on the run up to Christmas last year, the financial markets were more confident about a Remain win, so the pound was much stronger against the Euro and the average was around the €630,100 mark.If you do the maths, the drop in the pound close to the referendum has given buyers an average saving of 5.3 per cent, or around £25,500 in savings on average.Chancellor George Osborne had predicted a possible drop of 18 per cent fall in house price values over the two years following a Brexit vote success, fearing economic shock and reduced demand from overseas buyers.On the Leave side of the coin, campaigners are not disagreeing with George Osborne, but say the effect of reducing house prices following a Leave vote will mean property will become more affordable for young people stepping onto the housing ladder.Some economists have said that should we leave the EU and house prices decline, this will in turn make London property prices even more appealing for foreign buyers, especially if the pound weakens to a level on par with the euro.What we could eventually see is Eurozone buyers becoming even more active on the London property market should we decide to Brexit.

There are now more UK billionaires than ever before in the country it is the first time the figure has risen past the 100 mark according to the Sunday Times. The official figure is 104 billionaires who are living inside the UK. The total combined estimated figure is £301bn between the 104 who are worth more than £1 billion. This figure is hugely substantial and important as it means the UK now have more billionaires per head of population than any other country. London in the main center for billionaires, it holds more billionaires than any other city on Earth.

The exact figure is 72 billionaires and the next closet city is Moscow which has a mere 48 in comparison. The Indian run company Hinduja Group are at the very top of the list with a fortune of £11.9 bn. The Arsenal FC main shareholder Alisher Usmanov was downgraded to second after his approximate figure shrank to £10.65bn.Many of the billionaires will be 'non-domiciles' who will pay very little tax when compared to a resident of the UK. This gives the owners tax benefits if their resident country has less strict tax regimes.

The number of billionaires living in the UK has increased from 88 in 2013 to the latest figure of 104 in 2014.New people who have joined the list include West End producer Sir Cameron Mackintosh who is now worth £1bn and the founder of estate agents Foxtons who has a fortune of £1.07bn.Philip Beresford, who compiles the list, told the BBC "culture, financial services, nice tax regime, good education for their kids and a nice lifestyle where they meet their friends" were some of the key reasons as to why they were attracted to the United Kingdom.

Update June 2016:

According to the Forbes Rich List 2016, the Hinduja family, who top the list of the UK's richest, rose to number 58 from number 60 richest families in the world. The family, whose riches came from Indian-born business tycoon and investor Srichand P Hinduja, has a net worth of $14.6bn.Among the UK's richest are landowners and real estate bosses, as well as Virgin's business tycoon Richard Branson. According to the Sunday Times Rich List 2016: The number of billionaires in London has fallen, but it's still the super-rich capital of the world. However, the number of billionaires calling London home has fallen for the first time since the financial crisis in 2008. (source: Sunday Times rich list).The capital has lost three billionaires compared to last year, a fall of three per cent, but remains home to more than any other city in the world with 77.

The number of billionaires in Moscow, Los Angeles and Mumbai also declined, down 15 per cent, 12.5 per cent and 22 per cent respectively, according to figures from the latest Sunday Times Rich List. Overall, the number of billionaires in the UK grew, hitting an all-time high of 120 and with a combined wealth of £344bn.There was a shake-up of Brit-born billionaires, with James Dyson overtaking Sir Richard Branson at the top, and 17th overall, with a £5bn fortune. There is some differing of opinion between Forbes and the Sunday Times Rich List.

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Here is a list of countries with their number of currently resident billionaires this year according to Forbes:

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US, 540 billionaires

China (mainland), 251 billionaires

Germany, 120 billionaires

India, 84 billionaires

Russia, 77 billionaires

Hong Kong, 64 billionaires

Japan, 64 billionaires

United Kingdom, 50 billionaires

Italy, 43 billionaires

France, 39 billionaires

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Here are the world top 10 billionaires, their net worth, business, age, and where they live: (source Forbes)

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#1 Bill Gates $75 B, 60, Microsoft, United States

#2 Amancio Ortega, $67 B, 80, Zara, Spain

#3 Warren Buffett, $60.8 B, 85, Berkshire Hathaway, United States

#4 Carlos Slim Helu, $50 B, 76, telecom, Mexico

#5 Jeff Bezos, $45.2 B, 52, Amazon.com, United States

#6 Mark Zuckerberg, $44.6 B, 32, Facebook, United States

#7 Larry Ellison, $43.6 B, 71, Oracle, United States

#8 Michael Bloomberg, $40 B, 74, Bloomberg LP, United States

#9 Charles Koch, $39.6 B, 80, diversified, United States

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The UK`s economy is seeing signs of positive growth. It is reported that the economy grew by 0.8% in the first quart of 2014. This is now the fifth period of continual positive growth, which has been overseen by the conservative government. It is the longest run of positive growth since the financial crisis in 2008.Gross Domestic Product measures an economies activity and if it has increased or decreased in size. However the Office of National Statistics has explained the economy is only 0.6% smaller than its highest peak in 2008.The Chancellor George Osborne has stated "Britain is coming back".

However has warned that Britain`s biggest risk would be to abandon the plan of prosperity and restraint. The US and Germany economies have now surpasses their pre-recession growth peaks, the UK is still not ahead of its economy peak from 2008.However the UK did suffer from server weather which would did have an impact on large industries such as agriculture. Agriculture dropped by 0.07% as a direct result to the server weather the UK faced earlier in the year. Further good news is the International Monetary Fund explained that the UK is to the most impressive performing economy from the world`s largest economies in 2014 with growth forecasted to be 2.9% for the 12 month term.

Update June 2016:

The UK Economic Outlook has seen a 2.2% rise in real GDP growth in the first quarter of the year giving the UK the 2nd fastest growth rate in the G7 membership. Figures for the first quarter also show a 3%consumer spending growth with inflation standing at 0.5 percent. Although our economic recovery has been relatively slow since mid-2009, it is still growing at a faster rate than most of the other G7 member economies over the same period. Consumer spending has remained strong and many economists put this down in part to lower global oil prices meaning less cost at the petrol pumps for British consumers.

Financial experts have mixed outlooks globally for the rest of the year with the unknown effects of the EU Referendum, as well as the continued recessions in Brazil and Russia, plus a slowdown of growth in China. Many economists have predicted an average growth in UK GDP of just over 2 percent during 2016, mainly driven by consumer spending. This will be helped by a combination of low food prices and energy bills being kept down. The Capital city of London is expected to continue to lead the UK recovery with growth levels predicted to be around 3 percent for this year, but other regions across the country are also expected to show growth levels between 1.4 to 2.3 percent overall by the end of the year.

Long-term views held by economists predict that inflation will remain low for now, but may see a small rise in rates over a gradual period as we head towards 2020.With Government targets set to clear the budget deficit before 2020, we may see some further drag on the economy due to fiscal tightening of budgets, but it is thought that the strength of the private services sector will help to offset this with continued job growth and productivity. Are you looking for a virtual office service? why not get in touch with our expert team today, we can really help to boost your businesses presence and give you that professional edge that others in your sector may lack. Take advantage of the UK's growing economy with the prestige of having a London based office service.

With Britain's economic recovery,  there's the prospect of the fragile growth being thrown off course by the damaging impacts of recent flooding? Mark Carney, The Governor of the Bank of England, warned last week that farming and other businesses hit by floods could have a negative impact on Gross Domestic Product (GDP). In previous periods of bad weather such as heavy snow, this has reduced quarterly GDP by up to 0.2%. However, severe cold is more widespread whereas flooding tends to effect a relatively small area of floodplain and coastline.

Extensive snow makes it almost impossible for construction to take place - since construction accounts for around 7% of economic activity, a wide-scale pause in building works has a much bigger impact than flooding. If there is any possible 'upside' to natural disaster it is that, in purely economic terms, GDP tends to bounce back quite quickly. Japan for example has often experienced devastating earthquakes which produce an immediate hit to GDP as well as immeasurable human cost. However, once the reconstruction of houses, roads, bridges and other infrastructure takes place, the economy receives a tremendous stimulus and recovers quickly.

In the UK it will be the insurance companies who are amongst the first to count the cost of the wettest January on records by comparison, the 2007 floods cost insurers about £3 billion. Some economists have pointed out that repairs to roads and railway lines will probably help support the economic growth not to mention retailers of items like carpets and kitchens in affected areas. There will clearly be some negative statistical impact of this years floods on the UK's fragile economic growth. Although this is no consolation to people who have been severely affected, the flooding is unlikely to derail the recovery and could even provide a modest stimulus over the rest of the year. Richard Bloomfield is the website editor at The Workplace Depot

Update June 2016:

Figures released in January this year by the Association of British Insurers (ABI) predicted that losses caused by flood and storm damage during the winter of 2015 would far exceed those of two years ago resulting from the wettest winter on UK record. Insurance companies were expected to pay out around £1.3 billion for claims following a series of storms, flooding and heavy rainfall during the winter of 2015.The economic losses from the winter 2013-14 have been worked out by the Environment Agency but are yet been published by the Department for Environment, Food and Rural Affairs.

The ABI predicted that insurance claims would cost £1.1 billion, including £446 million for businesses and homes that were affected by heavy flooding. The bill for damages recorded this past winter is expected to exceed the roughly £600 million in losses caused by flooding during 2012, but will be much lower than what was claimed for the summer floods of 2007, which totaled around the £3.2 billion mark. The UK Climate Change Risk Assessment that was published in 2012, estimated that losses from coastal and river flooding in England and Wales could possibly rise from about £1.2 billion per year today to between £1.6 and £6.8 billion by the 2050s.

December 2015 was the wettest December for the UK since 1910 when Met Office records began. Climate change experts say that six of the seven wettest years on record in the UK have all occurred from the year 2000 onward. The UK has also experienced its eight warmest years on record. Climatologists are predicting that climate change is making the UK a warmer and wetter country overall. The UK Climate Change Risk Assessment estimated that about 6 million residential and non-residential properties in the UK are exposed to some level of risk of coastal, river or surface water flooding.

Individual insolvencies in England and Wales are at an all time low for over eight years. This is according to the latest government report. It is said that bankruptcy rates were the lowest rate since 2005.A reason to why the rate is falling is said to be due to people finding it harder to get credit due to lenders not willing to risk on individuals with lower credit ratings. However this can all change, the Bank of England is expected to raise its interest rate for the first time since 2009 due to the strengthening of the economy.

People will find it hard to repay mortgages due to the hike in interest and this can lead to further difficulty for people who are already stretched financially. So forecasters are expecting insolvency to rise in the near future. An insolvency partner at HW Fisher said: "These are the best insolvency figures we've seen in a while" "But with many of Britain's businesses still just 'hanging on', thousands of our weaker firms are far from out of the woods yet."" Sooner or later, interest rates will rise and bank forbearance will end - and when that happens the weaker firms will be in serious trouble," he added.

Update June 2016:

According to figures released in May this year by the Money Charity, UK personal debt statistics now topped £1.474 TRILLION at the end of March 2016. This rose from £1.434 TRILLION at the end of March 2015, which means an extra average debt of £793.13 per UK adult according to current population figures. The average borrowing per household, including mortgage loans, was calculated to be £54,597 in March, making the average debt per adult £29,190,which is around 111.9 percent of UK average earnings. Consumer credit levels still outstanding was shown to be £182.4 billion at the end of March 2016, up from £171.1 billion at the end of March 2015. This works out at an increase of £198.45 for every adult in UK, making average consumer credit borrowing per UK adult £3,613.Credit card debt in January 2016 accounted for £63.3 billion, an average of £2,381 debt per household held on 'plastic'.

Not good news for for many people with credit card debt who can only afford to pay the minimum rate each month. With average credit card interest rate at current levels, it would take 25 years and 6 months to repay by only making minimum repayments each month. The number of personal insolvencies declared now stands at an average of  222 people a day.  This is equal to one person going bankrupt every 6 minutes and 13 seconds. You can see the full breakdown of these and other figures on the Money Charity site here.

The UK is said to have missed the export targets of doubling the value of its exports to £1 trillion by 2020. The PAC said the UK is not performing as well as its European counterparts, France, Germany and Italy. However a government spokesman stated "real progress" has been made on the increase of exports worldwide. The foreign & commonwealth office (FCO) and the UK Trade and Investment (UKTI) offices spent over £420 trillion on 2013 on promoting exports worldwide. However reports state that the growth did not really increase, remaining 'flat' reported by the BBC. One factor which has been sighted in hampering the UKs export increase are tighter visa restrictions.

This is seen to put potential business travelers off from vesting the UK. This can really have a major effect in building relationships with foreign companies. A spokesperson explained that despite the coming shortfall in the governments, progress is being made. The spokesperson explained: "As part of the government's long term economic plan we have set ourselves an ambitious target to double exports by 2020. We make no apology for setting a stretching target and we are working hard to achieve this."" We are shifting our focus towards targeting high-value opportunities, providing more support and advice for UK small and medium sized businesses.

We are also establishing an overseas business network which will include British Business Centers in key markets across the world including India, China and UAE."" We have made real progress through our increased efforts in some of the growth markets further afield: exports to China, for example, have increased by 91%, and exports to Russia are up by 118%."

Update June 2016

Despite the government's aim of increasing UK exports to £1trn by the year 2020, recent projections are showing that we are still falling short of meeting that goal. However, UK businesses have even more opportunity to export than ever before. As a country with a proud history of trading, the Office for National Statistics (ONS) has revealed that our goods trading deficit did in fact narrow during January this year, despite the gap growing overall as Britain imported more goods into the country. According to Howard Archer, chief UK and European economist at IHS Global Insight, “exports are being hampered by the sterling's overall strength in 2015, particularly against the euro, and moderate global demand."

While there are many reasons that cause figures to fluctuate, exporting still remains a key component of a healthy economy, and those companies who export their goods have been shown to be four times less likely to fold and go bankrupt. Even during times or recession, exporting companies are around ten times less likely to fail than other companies, according to figures released at the Global Trade Review UK trade and export finance conference. The head of UK Trade and Investment (UKTI), Catherine Raines, has urged British companies that export, as well as foreign buyers and business investors to work together to boost exports – namely through Exporting is GREAT, a programme launched by the Government to help UK companies benefit from real-time export opportunities in all sectors, across the world.

Taking part in the programme has offered companies up to 40 new opportunities each day to export - or roughly an opportunity every 37 minutes. The programme links together 109 different countries across 44 business sectors, and export opportunities are not limited to the EU either with chances to trade with other countries such as China and Finland to name but two. The advancements in digital technology has enabled British business to potentially trade with the whole world, so even the smallest of UK companies can have a global reach and a chance to grow new markets. Capital Offices Virtual Office Services in London are great way for foreign companies and business investors looking to setup in the UK without having to outlay expensive overheads which are associated with London office space. Our complete Virtual Office London package is ideal for businesses who are wanting to get ahead and want to impress their clients and associates.

Our virtual office package combines our highly sought after central London business mail forwarding address with a professional and experienced virtual PA telephone answering service. Our team is highly experienced, having been based in City Road since 1971, we understand how businesses operate and have helped many countless clients expand and reach their goals. Why not take a look at the range of comprehensive packages we offer at very reasonable prices.