UK economy rebounds as Covid restrictions ease

UK gross domestic product (GDP) is estimated to have increased by 4.8% between April and June 2021 as trading restrictions were eased in the spring months. The latest figures from the Office for National Statistics (ONS) also show that GDP increased across all three months in Q2 2021 at 2.2% in April, 0.6% in May and 1% in June 2021. The level of GDP in the UK is now 4.4% below the pre-pandemic level at the end of 2019.

Hospitality saw the largest growth in Q2 (87.8%), followed by the wholesale and retail sector, which increased by 12.8%.

Jonathan Athow, national statistician for economic statistics at the ONS, said: “The UK economy has continued to rebound strongly, with hospitality benefitting from the first full month of indoor dining, while spending on advertising was boosted by the reopening of many services.”

The ONS also credited the re-opening of non-essential retail, and the Euro 2020 Championship for the economic recovery in the services sector whilst the reopening of schools also saw education output increase by 19.4%.

Chancellor Rishi Sunak told the BBC: “Today’s figures show that the economy is recovering very strongly, exceeding many people’s expectations.

“But I’m not complacent. The economy and our public finances have experienced a significant shock. It is going to take us time to fully recover from that.”

What happens next however is still uncertain. The safety net that has protected livelihoods – the furlough scheme – ends in October, and economists think there will be some job losses, albeit far fewer than assumed a year ago. For advice on business stability and growth, contact us for a no obligation meeting at any of our practices in Bristol, Newport or Penarth.

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