However, Carolyn Fairbairn, CBI director-general, said these ‘welcome words must be followed through’, adding that the UK needed ‘clarity on industrial strategy and Brexit ambitions to be matched with urgent delivery.

Fairburn added: “The Prime Minister reaffirmed the government’s full commitment to the Florence speech and a status quo transition. This is essential for firms across the country, providing much needed stability and avoiding a catastrophic cliff-edge scenario.

“All in the government must embrace this: the road to a Florence Deal must be swift and have no deviations. Every opportunity must be taken to reduce uncertainty for the sake of jobs and the economy.”

The CBI was one of five business groups who wrote to Brexit secretary, David Davis, to warn that the UK risked losing jobs and investment unless a transition deal was agreed swiftly.

On industrial strategy, the Prime Minister urged greater commitment to research and development spending, pointing out that UK businesses fell short of their German and US peers for business investment.

Fairburn said: “The Prime Minister gave her wholehearted backing to a modern industrial strategy that backs dynamic, responsible business rather than heavy handed intervention.

“Four out of five firms are clear that industrial strategy is the fundamental building block of a fair UK economy with great jobs and rising living standards. With the pace of change of technology accelerating, business and government must move quickly, together, to transform innovation, skills and infrastructure to boost all sectors and regions.”