UK economic recovery slows sharply as GDP grows by 1.3%

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Britain’s recovery from its third Covid-19 lockdown slowed sharply over the summer as growth in the economy was hit by rising infection rates, pingemia and drug shortages. global supply.

Figures from the Office for National Statistics show that national production rose 1.3% in the three months ending in September, leaving it still more than 2.1% below its pre-crisis level in the fourth quarter of 2019.

The third quarter performance follows a 5.5% expansion in the three months ending June – a period in which activity restrictions were lifted.

Staff shortages and supply constraints mitigated the impact of ending the remaining foreclosure restrictions in July, with poorer business performance also acting as a drag on growth.

Of the three main sectors of the economy, services have experienced the fastest growth. A 30% jump in hotel and restaurant activity means the sector – which accounts for around four-fifths of GDP – grew 1.6% in the quarter.

A 0.3% drop in manufacturing output limited growth in the overall production sector to 0.8%, while construction registered a 1.5% decline.

In September alone, gross domestic product advanced 0.6%, following an increase of 0.2% in August and a decline of 0.2% in July. Using monthly figures, which date the peak of the pre-crisis economy to February 2020, GDP is 0.6% lower than before the onset of the global health crisis.

ONS Chief Economist Grant Fitzner said: “Growth resumed in September and the UK economy is now only slightly below pre-pandemic levels.

“This latest increase has been led by the healthcare industry, driven by more visits to GP practices in England. Lawyers have also had a busy month, with homebuyers rushing to complete their purchases before the stamp duty holiday ends. However, these were partially offset by declines in both manufacturing and sales of cars.

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“Notably, business investment remained well below pre-pandemic levels in the three months leading up to September. Meanwhile, the trade deficit widened as merchandise exports to non-EU countries declined and imports – especially fuel -om non-EU countries increased. increase.

Suren Thiru, Head of Economics at UK Chambers of Commerce, said: “The latest data confirms that the UK’s economic recovery lost momentum in the third quarter, as severe staff and supply shortages have limited activity.

“Although monthly output rebounded in the quarter from the July contraction, this more likely reflects a temporary boost from the easing of restrictions, rather than a significant improvement in the Kingdom’s underlying growth path. -United. “


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