The British Chambers of Commerce, which represents more than 100,000 UK businesses, has cut its forecast for economic growth this year from 0.6% to 0.1% in its latest Quarterly Economic Forecast. Its lower forecast follows official figures which show that the UK economy shrank by 0.3% in the first quarter of this year, meaning Britain is now back in recession. The downgrade came as the BCC urged the Government to introduce growth-creating measures such as increased infrastructure spending. BCC director-general John Longworth said, “We need growth and we need it now. If the Government works together with the private sector to create the right environment over the long term, we’ll be able to prove once and for all that bold businesses can propel us forward out of stagnation and firmly on the road to recovery.” The BCC expect unemployment will also increase from 2.625 million, or 8.2% of the workforce, to 2.9 million, or 9% in the third quarter of 2013, driven mainly by continued public spending cuts.

The slight good news game as the BCC upgraded its growth forecast for 2013 from 1.8% to 1.9% as it predicts economic activity to start picking up from July. The BCC said that growth between April and June will be flat or slightly negative, prolonging the recession, but should improve from the third quarter onwards.