Economy returned to reverse gear in November with 2.6% contraction

The UK economy returned to a reverse gear in November as tightened coronavirus restrictions took their toll on the fightback from the steepest recession on record, according to official figures.

The Office for National Statistics (ONS) reported a 2.6% slump in output during the month – building on a loss of momentum that began late last summer.

November was the month that England joined other parts of the UK in a second lockdown.

The first, which was UK-wide and began in March, was responsible for the unprecedented slump that saw most of the economy placed in virus hibernation.

The ONS said the economy was 8.5% below its pre-pandemic level by November and experts have warned that the UK faces the prospect of a double-dip recession given measures to contain COVID-19 since then.

However, the negative growth figure was much better than the 5.7% economists had predicted.

The ONS also upwardly revised October’s growth to 0.6% from an earlier estimate of 0.4% and said it was clear that the impact of restrictions in November were less severe than during the first lockdown as more businesses operated.

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Nevertheless, November’s decline still represented the first monthly drop in output since April.

On a sector-by-sector basis, construction saw the best growth while services, which accounts for almost 80% of the economy, and factory output both declined.

Politics

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