UK’s economic surge still leaves nation catching up

Britain’s economy grew by a record 15.5 percent in the July to September third quarter of the year, but remains 8.2 percent smaller than before the pandemic, official figures show.

The growth figure is the largest recorded by the United Kingdom in a single quarter and is a clear turnaround from the first six months of the year, when gross domestic product, or GDP, fell 22.3 percent.

However, the economy grew by a slower-than-expected 1.1 percent in September from August, even before the latest restrictions on businesses, said the latest data from the Office for National Statistics, or ONS.

Analysts warned of further contraction to come, driven by the second national lockdown this month.

The Bank of England estimated that the world’s sixth-biggest economy was estimated to slump by 11 percent over the year, before growing by just over 7 percent in 2021.

An ONS comparison showed Britain’s economy has suffered the biggest drop among major economies, twice as big as the falls in Italy, Germany and France and nearly three times the size of the drop in the United States.

Reuters reported that the UK economy is being supported by more than 200 billion pounds ($264 billion) in emergency spending and tax cuts ordered by the Chancellor of the Exchequer Rishi Sunak and by the Bank of England’s 900 billion pound bond-buying program.

Sunak acknowledged in a statement on Thursday that recovery had slowed. He said: “The steps we’ve had to take since to halt the spread of the virus mean growth has likely slowed further.

Cautiously optimistic

“But there are reasons to be cautiously optimistic on the health side — including promising news on tests and vaccines.”

In September there was a boost for education as children went back to school and house building continued to recover.

Jonathan Athow, deputy national statistician at the ONS, warned: “While all main sectors of the economy continued to recover, the rate of growth slowed again, with the economy still remaining well below its prepandemic peak.

“However, pubs and restaurants saw less business after the Eat Out To Help Out scheme ended, and accommodation saw less business after a successful summer.”

The crisis is having a stark impact on jobs as unemployment rose to nearly 5 percent in the July-September period as redundancies reached a record 314,000, up from 181,000 in the previous quarter.