The report showed that the third quarter of 2022 was the ninth consecutive quarter of growth, with an 8.8% total rise in advertising spend across the whole of 2022.

The AA and Warc projected a 3.8% increase in advertising spend for 2023 to a total £36.1bn for the whole year, but added this amounted to a 3% real terms decline once inflation was taken into account.

The first nine months of 2022 saw a 10.8% boost for advertising spend, standing at a total £25.3bn for the period covered.
There was a 148.1% rise in cinema advertising and a 13.2% increase in out-of-home, while search was up 7.7%.

Social media, included within online display, continued growing at 4.4%, while broadcast video on-demand spend rose by 4.3%.

The AA and Warc also predicted a continued recovery in the ‘golden quarter’ of October to December 2022, with an estimated 4% rise to £9.5bn in advertising spend, owing to Christmas and the Fifa Men’s World Cup.

Stephen Woodford, chief executive at the AA, said: “The UK advertising industry has held firm in its continued recovery from the Covid-19 pandemic, with ad investment holding up in the face of significant headwinds.

“However, the economic pressures of 2022 including high inflation’s impacts on the wider economy and on media costs means in real terms spend is likely to be flat. These pressures all contribute to slower growth projections for the year ahead.”

James McDonald, director of data, intelligence and forecasting at Warc, said: “With the economy enjoying modest growth in November, and inflation appearing to have reached its peak, it is likely that the UK narrowly avoided slipping into the recession at the end of last year that many had feared – but a downturn now seems unavoidable in 2023.

“Despite an air of resilience in recent market results, a looming recession will put pressure on ad trade this year. The silver lining here is that our current modelling suggests that the slump will be short lived, with advertising investment set to lift by 5% over the first nine months of 2024.”