According to a regular survey conducted by the Institute of Chartered Accountants in England and Wales (ICAEW), business confidence in the UK is at its highest since the survey began 10 years ago.
The BCM Confidence Index stands at +37.2, up from +31.7 in the last quarter of 2013, indicating that the UK economy could grow by 1.5 per cent in the first quarter of this year.
Businesses reported the fastest investment growth since the first quarter of 2007, although expected growth in exports has fallen back. According to the ICAEW, this indicates that the economic recovery is accelerating. However, it is concerned that export growth is predicted to slow down.
Meanwhile, the survey suggested that the recent positive trend shown in the official employment numbers would continue, with an average increase in headcount of 1.7 per cent over the next 12 months.
The brightest sector was construction, with confidence sharply higher among builders although output remains below its pre-crisis peak.
However, the banking, finance and insurance sectors have all shed jobs over the past year and expect to continue to do so.
The survey also found that turnover and profit growth both picked up and businesses expect this to continue for the rest of this year, with turnover set to grow by 5.4 per cent over the coming year compared to 4.2 per cent during the year before.
There are signs that businesses also are becoming more willing to invest, with capital investment expected to increase, although the share of businesses operating below capacity has increased slightly.