THE British public is optimistic about prospects for the economy over the next year, according to a Times poll.
The Populus poll, undertaken over last weekend, shows that nearly two thirds of the public thinks that the economy will do very or quite well in that time while a third believes it will do badly.
The findings coincide with evidence that a revival in services activity on both sides of the Atlantic has boosted confidence that a global recovery is under way.
UK house prices rose by 1.3 per cent last month, according to the Halifax, Britain’s largest mortgage lender, which reported renewed activity in the mainstream London market.
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Britain’s services sector enjoyed its strongest expansion for more than a year during July, according to the latest CIPS/Reuters purchasing managers’ snapshot. Industrial output rose by 0.7 per cent in June, compared with the previous month, to stand 2.2 per cent higher than a year earlier — the strongest annual rise since July last year.
Across the Atlantic, a surge in activity in the US services sector boosted optimism over recovery, while eurozone services also showed signs of life.
According to the Populus poll, voters took the same view about economic prospects for “the country as a whole” and for themselves personally. By a two-to-one margin, voters think the economy will do very or quite well for “me and my family”.
This is surprising since some might have been expected to be more pessimistic for their families in view of the possibility of higher taxes.
This continued optimism comes despite widespread concern over mounting levels of personal debt and probably reflects the historically low level of interest rates and continued high levels of employment.
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The poll was conducted just after mortgage holders received notices of a cut in interest rates. However, older voters, who lose income from savings in a rate cut, tend to be a little more pessimistic than younger voters.
The poll shows that Labour voters are much more optimistic than Tory ones. The net optimism of Labour voters about the economy as a whole (those thinking it will do well minus those thinking it will do badly) is plus 70 percentage points. This compares with plus 12 points among Tories.
Floating voters, those who may change their minds before the next election, are slightly more optimistic than the average about the outlook for the country as a whole: plus 36 percentage points, against plus 33 for all voters.
Liberal Democrat voters are also more optimistic than the public as a whole.
Men are more optimistic than women (plus 37 points, against plus 27), while professionals and managers are most optimistic about prospects for their own families (plus 50 per cent), nearly double the level among working class groups. This link is less clear about the outlook for the country.
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However, there are marked regional variations. Scottish voters are the most optimistic (plus 54 points about the country as a whole), partly because there are more Labour voters north of the border, who are much more optimistic than the average. Next comes the North, on plus 37.
The pattern is slightly different when voters are asked about the economic outlook for them and their families. Scotland is again top, at plus 56 points, but this time the South East comes a strong second, at plus 45 points.
Voters in the Midlands are least optimistic about the outlook either for the country (plus 19) or for them and their families (plus 20). This could have electoral significance in view of the number of marginal Labour seats in the region.
Populus interviewed 1,001 adults aged over 18 across the country by telephone between August 1 and 3.