UK GDP suffers biggest fall since records began

The UK’s GDP suffered a fall of 20.4% in April, according to new data released by the Office for National Statistics (ONS).

As the first full month since the UK went into lockdown, April saw the biggest monthly fall since ONS records for GDP began in 1997.

The data also showed that the economy had fallen by 10.4% in the three months to April, as government restrictions on movement dramatically reduced economic activity.

The ONS stated that the impacts of coronavirus were registered across the economy as all the headline sectors provided negative contributions to GDP growth in the three months to April – with the services sector falling by 9.9%, production by 9.5% and construction by 18.2%.

ONS deputy national statistician for economic statistics, Jonathan Athow, revealed April’s fall in GDP was “more than three times larger than last month”, and “almost ten times larger than the steepest pre-COVID-19 fall”.

“In April, the economy was around 25% smaller than in February,” he said.

“Virtually all areas of the economy were hit, with pubs, education, health and car sales all giving the biggest contributions to this historic fall. Manufacturing and construction also saw significant falls, with manufacture of cars and housebuilding particularly badly affected.

“The UK’s trade with the rest of the world was also badly affected by the pandemic, with large falls in both the import and export of cars, fuels, works of art and clothing.”

Royal London Asset Management senior economist, Melanie Baker, said the efforts to contain COVID-19 had caused “huge economic disruption”.

She added: “April should be the lowest point for GDP data. With the easing of social distancing measures, figures will improve. The figures also show why it is still too early to start withdrawing policy support from the economy, despite having entered the recovery phase.”

In response to the figures, Trades Union Congress general secretary, Frances O’Grady, called on the Government to set up a national recovery council with unions and business.

“If we act now, we can stop deep damage becoming lasting damage. The Government must work closely with unions and business to get the next steps right,” she commented.

“The national recovery plan must prioritise protecting and creating jobs. The more people in work, the faster we will work our way out of recession.

“The Government should set up a national recovery council with unions and business to plan how we can build back better. We need targeted support for hard hit sectors of the economy, and a jobs guarantee to help those who do lose work.”

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