The long hiatus in business investment seen since the vote for Brexit may have finally run its course. Years of low investment costs can end in a dam break.
Most business leaders I speak to cite political drift and inefficiency as a major cause of gridlock, so welcome the return of more stable government. A more harmonious relationship with Europe is something perhaps only Sir Keir has been able to achieve in recent years.
Another big hope for the future is our old friend artificial intelligence. We shouldn’t be too focused on estimating the real-world significance of AI, but it’s no less reasonable to assume at least a potential productivity gain like the IT revolution of the 1990s and early 2000s.
If Britain can get ahead of the game in deploying new technologies across sectors, AI may finally begin to lift the economy from its current low-productivity trajectory.
We can’t know the future, but we can imagine a world in which Donald Trump wins, some sort of peace settlement is carved out in Ukraine and Gaza, and, contrary to expectations, tensions between China and the US ease rather than deepen.
Any such scenario may seem unlikely at present, but further escalation of geopolitical tensions is not inevitable; It’s possible that things could get worse.
Of course, even with Labour’s published agenda, there is plenty to worry about about what it might do once in power. Uncompromising attachment to net zero goals, without consideration of the implications and costs for the wider economy, is a continuing concern.
Yet assuming Starmer and Reeves can keep their party’s hotheads in check, there’s no reason to believe a change of government is going to dramatically change the big picture of the economy. Fortunately for them, the trend is one of progress. They would have to make a terrible mistake to blow it up.