Low energy consumption and civil service strikes have offset growth in UK sectors like construction. ONS (the Office for National Statistics) data shows construction grew by 2.4% in February. The sector performed better than in previous months due to increased retail output and repair works. However, the UK economy recorded a 0% GDP growth amid economists’ stake for a slight 0.1% decline. ONS forecasted a 0.7% growth in January and a 0.1% Feb decline.
Public administration was the second in negative growth as strikes hit the services sector. Education also contributed significantly to negative growth after falling by 1.7%. In general, the unpredictable dry and mild weather hampered gas and electricity production. Nonetheless, output in the recreation, entertainment, and arts industries rose. The ONS report also confirmed that the UK economy avoided a recession during the second 2022 half.
Instead of a recession, the economy grew by 0.1% in the final 2022 months and rose by 0.4% in January 2023. The OBR (the Office for Budget Responsibility) is the recent independent economic forecaster to confirm that the UK economy averted a recession in late 2022. In any case, the UK's overall economy will still decline by about 0.2% this year. The OBR has warned that the living standards could hit their biggest fall in records.
Meanwhile, the UK economy rose slightly quarterly, but the Chancellor of the Exchequer remained upbeat about the figures. Jeremy Hunt explained that the economic outlook was way better than expected. The GDP had risen in three successive months, and the economy was sure to avoid a recession. He explained that the achievement was due to the radical reforms to lift business investment & employment and cost of living support.
On the other hand, the Labor chancellor disapproved of the UK’s report on economic growth. She explained that the UK still lags on the global market with minimal growth. Racheal lamented that the situation had pushed families to worse off with a weaker economy and high streets in decline to cause vulnerable shocks. Therefore, she projected that the Labor mission would be to secure sustained growth among the G7.
Above all, the chief economist of the Bank of England explained that the 0% GDP growth was disappointing. But she maintained that it marked significant economic progress from the forecasted recession. Overall, economists worried about a prolonged recession last summer. So talking of a stabilizing economy right now means a big deal of improvement.
