The UK economy hasn't grown more than the US

The US has grown by 2.3 per cent in the last year, while the UK has remained flat.

The final set of US growth figures before the presidential election were released today, showing that the economy grew at an annual rate of 2 per cent in the third quarter or a quarterly rate of 0.5 per cent. The Tories, unsurprisingly, are keen to point out that that's a worse performance than the UK, which, as we learned yesterday, grew at a quarterly rate of 1 per cent in Q3.  But they would be wise not to invite too much comparison of the UK and US economies.

First, while the US has grown by 2.3 per cent over the last year, the UK economy has failed to grow at all. As the Office for National Statistics reported yesterday: "GDP in volume terms was estimated to have been flat in Q3 2012, when compared with Q3 2011".

Second, while the US economy is now 2.3 per cent above its pre-recession peak, the UK remains 3.1 per cent below. The US has grown for 13 consecutive quarters, but we've only just recovered the output lost in the double-dip recession (a fate that the US, partly thanks to a policy of stimulus, rather than austerity, avoided). As a result, while they've grown by 3.9 per cent over the last two years, we've grown by just 0.6 per cent.

Finally, since the UK Q3 figure was artificially inflated by the bounce-back from the extra bank holiday in June (responsible for around half of the 1 per cent growth) and the inclusion of the Olympic ticket sales (responsible for 0.2 per cent), it's foolish of the Treasury to cite it as proof that we're "on the right track". Indeed, as I wrote yesterday, a significant number of forecasters believe it's possible or even probable that the economy will shrink in quarter four. Rather than complacently boasting about a one-off surge in growth, the Tories should be acting to prevent a triple-dip recession.

The US economy is now 2.3 per cent above its pre-recession peak, while the UK remains 3.1 per cent below. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Theresa May wants a Global Britain? Then stay in the single market

The entrepreneur Lord Bilimoria argues the Prime Minister risks both the prosperity and reputation of the UK. 

Since coming to the UK as a student in the early 1980s, I have witnessed the shattering of its glass ceiling and the birth of one of the world’s most enterprising nations. Much of this progress is now under threat due to the great uncertainty Brexit is causing.

It has been six months since the referendum, and we are still presented with no clear strategy except a blind leap of faith out of the single market. By continuing to pursue a closed and inward-looking Brexit, Theresa May risks both the prosperity and reputation of this country. 

Last week I joined with thirty other entrepreneurs and business leaders in urging the Prime Minister to keep Britain within the EU single market. In the coming months Mrs May will face having to make a trade-off between immigration control and loss of single market access. The decision she makes will determine whether we retain much of our economic strength. 

That is why I was disappointed to see May’s most recent comments simply reinforcing the message that the government is pursuing a "hard" Brexit. Over the weekend her big interview sent the pound plunging – yet again. 

It is clear the government is solely focused on delivering stricter immigration regulation, regardless of whether it leaves Britain stranded outside the single market. To fall into the trap of calling the PM "Theresa Maybe" masks the decisive nature of her emerging strategy – which is to head for the hardest of exits.

We know that neither Council President Donald Tusk nor chief negotiator Michel Barnier will accept access to the single market without freedom of movement being part of the deal. This is incompatible with the vision set out by the government.

Yet, movement and access to the single market are vital to the future interests of British business. The PM must do more to reassure those set to be affected. We are currently part of a 500m-strong single market; this is good for British business. Although I believe the whole of Europe needs to reform the current free movement of people, not least for security reasons, we nevertheless must continue to have the ability to move freely within the EU for tourism, business and work.

It is becoming unequivocally clear that the PM is willing to pay any economic price to achieve stricter immigration controls for political gain. Driven by the fear that the far-right will use immigration in future election battlegrounds, the issue of immigration is undermining our ability to negotiate an exit from the EU that is in the best interest of businesses and the nation as a whole. 

The government’s infuriating failure to prioritise continued movement of people means we are set to lose a hugely competitive edge, reducing access to talented employees, and undermining the UK’s rich history of an open, diverse, and welcoming nation.  

To achieve the government’s absurd immigration control, we will have to leave the European single market. In doing so 44 per cent of our exports, the current percentage that go to Europe, will be jeopardised, as they will no longer have free access to their original markets. 

In tandem with an exit from the world’s largest single market, British business will also lose access to one of the strongest international talent pools. This has the potential to be even more devastating than the forfeiture of markets and trade.

Access to skilled workers is critical to future success. As a nation we have the lowest level of unemployment in living memory with less than 5 per cent currently out of work, and that’s in spite of 3.6m people from the EU working in Britain.

Britain will continue to need the expertise that free movement currently provides, regardless of whether Brexit happens or not. You cannot simply replace the skilled doctors, nurses or teachers living and working here overnight. 

The focus on immigration has also strayed into more dangerous territory with the government persisting in including international students as immigrants when calculating net migration figures, whilst having a target to reduce net migration to the tens of thousands. The PM’s insistence on this policy not only stifles encouragement of talent flows, but also sends an incredibly negative message to the international community. It is a policy that I have continually called on the PM to change and I will continue to do so.

Our competitor countries, the United States, Canada, and Australia, do not categorise international students as immigrants and, in fact, they also provide generous incentives to stay in their countries to work after graduating. In comparison, we removed our popular two year post-study work visa in 2012.

Brexit poses an increasingly dangerous reality that we are destined to be viewed as an inward-looking, insular and intolerant nation. That is not the Britain I know and love. That is not the Britain that has attracted enterprising individuals. The UK needs to establish itself once more as an outward-facing nation that welcomes international talent and entrepreneurship. This starts with retaining membership of the single market.  

Lord Karan Bilimoria is a leading British businessman and the founder of Cobra Beer.