THE Government should seize the opportunity to help more North-East businesses join the recovery, business leaders said, as the latest figures showed the economy grew at its strongest rate since 2007.

Ministers and company bosses hailed a 1.9 per cent Gross Domestic Product (GDP) rise in 2013 as a strong sign that recession fears are fading. 

But growth in GDP for the last quarter slipped to 0.7 per cent, down from 0.8 per cent in the previous quarter, and economic output is still 1.3 per cent below its 2008 first quarter level.

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There were also nagging fears that the recovery is not reaching people across the North-East, or boosting all industries.

Chancellor George Osborne said the latest Office for National Statistics (ONS) figures showed that the Governments long-term economic plan was working.

Ed Balls, Labour's shadow chancellor, said: "The growth figures are welcome and long overdue after three damaging years of flatlining.
"But, for working people facing a cost-of-living crisis, this is still no recovery at all.

"And with business investment still weak, construction output down and housing demand outstripping housing supply, this is not yet a recovery that is built to last."

The UK's service sector, which makes up more than three-quarters of output, rose by 0.8 per cent in the fourth quarter, matching its performance in the previous quarter. And the manufacturing sector grew 0.9 per cent.

Construction fell by 0.3 per cent in the quarter, despite the recent recovery in a housing market boosted by the government's Help to Buy scheme.

TUC general secretary Frances OGrady said: "Any return to growth is welcome, but this is the wrong kind of recovery and is two years late.

"The recovery is yet to reach whole swathes of the country or feed into peoples pay packets. This must change if the benefits of recovery are to be felt by both businesses and workers.

"Unless the short-term boost provided by house prices and consumer debt is transformed into investment, rebalancing and higher living standards, the danger is that it will prove unsustainable."

North-East business welcomed signs of improvement.

Mark Stephenson, of the North East Chamber of Commerce said:
"These growth figures confirm what we have seen in our own Quarterly Economic Surveys throughout 2013 and particularly in the last quarter.

"North-East businesses are growing, investing in recruitment and equipment, seeing a rise in sales and orders and are increasingly bullish about their prospects.

"This growth has been driven by our businesses and the Government now has a perfect opportunity to seize the momentum and empower our companies to deliver more for UK plc.

"Support must be made available to improve skills, build on the transport infrastructure projects already planned and boost inward investment support in the region."

In the services sector, Mike Odysseas, managing director of technology firm Odyssey Systems in Stockton, said: "These figures, which confirm four successive quarters of significant growth, come as no surprise to me - they reflect the real growth and recovery we have been seeing here at the sharp end of the economy for some time now.

"The services sector has once again performed exceptionally well, echoing the expansion we saw in our own company last year."