The UK economy is too reliant on the financial services sector and the government must seek to rebalance it, according to the Trades Union Congress (TUC).
As part of the latest TUC economy report, the trade unions body has highlighted what it determines to be ‘four key imbalances’ in the economy.
The organisation cites low levels of investment, over-reliance on financial services, a North-South divide and widening wage inequalities as factors holding back growth.
It says that these imbalances were the root of the financial crash and are now restricting economic recovery.
According to the report, the proportion of the economy accounted for by exports and investment is no higher today than five years ago, and stands at 13 per cent.
Rebalancing the UK economy so that growth is more evenly more spread across industries, throughout the country and across the workforce is ‘absolutely vital’ towards a sustainable economic recovery, the TUC argues.
It is also calling for a state bank to improve the UK’s ‘poor investment record’.
Brendan Barber, TUC general secretary, comments, ‘Having seen the damage caused by our over-reliance on the City, everyone agrees that our economy needs to be better spread across industries and throughout the country.
‘But so far progress towards achieving this rebalancing has been woefully slow and in some cases is going in the wrong direction.’
Barber would like to see companies invest more of the £750 billion they are sitting on to allow for new industries outside of London and the South East.