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The UK economy unexpectedly contracting in October, the second month in a row with negative growth, new figures show. It is the first time the UK economy has suffered negative growth in back-to-back months since the pandemic. Chancellor Rachel Reeves said she was “disappointed” by the data after a weak month for pubs and restaurants dragged on growth amid some uncertainty ahead of the autumn Budget.
The Office for National Statistics (ONS) said gross domestic product (GDP) contracted 0.1% in October. (Image: Lucy North) Most economists had been expecting GDP to rise by 0.
1% during the month. The Chancellor said: “We are determined to deliver economic growth as higher growth means increased living standards for everyone, everywhere. This is what our Plan for Change is all about.
“While the figures this month are disappointing, we have put in place policies to deliver long-term economic growth.” The latest figures from the ONS follow a 0.1% estimated fall in September – meaning it is the first time the economy has contracted for two consecutive months since March and April 2020, during the onset of the Covid-19 pandemic.
It marks a fractional shift in the outlook for the economy after it eked out 0.1% growth over the latest quarter, between July and September. The ONS said the services sector recorded no growth in October after also stalling in September.
Liz McKeown, the ONS’s director of economic statistics, said: “The economy contracted slightly in October, with services showing no growth overall and production and construction both falling. GDP fell 0.1% in October 2024.
Services showed no growth, while Production (-0.6%) and construction (-0.4%) both fell.
Read the full release ➡️ https://t.co/xHSGkRpgGz pic.twitter.
com/IfK4LPeJrw — Office for National Statistics (ONS) (@ONS) December 13, 2024 “Oil and gas extraction, pubs and restaurants and retail all had weak months, partially offset by growth in telecoms, logistics, and legal firms. “However, the economy still grew a little over the last three months as a whole.” The ONS’s monthly business survey showed signs of a mixed response ahead of the autumn Budget announcement at the end of the month.
Some industries, like manufacturers, retailers and recruiters, said turnover was affected as they waited for the outcome of the tax-setting statement. Others, like real estate and legal services, were more positive and increased activity in the run-up, according to the ONS..
