UK economy to suffer recession hangover until 2013

The UK will not recover to pre-crisis levels of growth until 2013, the National Institute of Economic and Social Research (NIESR) has said.

In its latest estimate of GDP, the think tank warned the UK's lack-lustre recovery from the downturn was poised to continue, as the effects of the austerity package weighed and other factors on growth. In its monthly estimate NIESR said output grew by 0.4% in the three months to end of May, an improvement on the 0.1% in the three months to end of April. However, it said the growth figure was still subdued, and it warned there would be no return to the boom period for some time. The organisation said: "These figures suggest the level of output is still almost 4% below its pre-recess...