UK 'will be fifth biggest economy by 2020'

“I don’t think France followed Germany in terms of making fundamental reforms to its labour market in the early 2000s. There’s still a sense that they’ve got this problem of high unemployment whereas Germany hasn’t had anything like the same problems of unemployment in recent years,” he said.

Growth in Germany is predicted to slow in the coming years because of the country’s ageing population, enabling Britain – now the world’s sixth largest economy — to close the gap between the two countries. With an average age of 44, Germany has the second-oldest population in the world behind Japan, according to the Pew Research Center.

However, PwC said the rapid rise of the Indian economy with its even younger workforce would push it up from being the 10th largest economy in 2013 to the third largest by 2030, pushing the UK back into sixth place. “In the longer run, other emerging markets may overtake the UK, but only India looks set to do so before 2030 according to our latest projections,” PwC said in its latest economic outlook.

China, the world’s second largest economy, is expected to close the gap with America by 2030, while Mexico is predicted to be the 10th largest economy by 2030, above Canada and Italy, both G7 nations.

PwC urged policymakers in the UK to implement further structural reforms to ensure that it remained ahead of emerging markets.

It said a broader analysis of Britain’s economy based on factors such as inequality and education standards ranked the country fifth among the G7 nations. Mr Hawksworth said raising education standards and carrying out infrastructure projects would help to ensure the UK economy stayed competitive amid increasing globalisation.

Last week a series of surveys showed the country’s services, manufacturing and construction sectors to be in robust health.

similar findings by the CEBR, which said Britain's position outside the eurozone also better prosecrts.

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