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UK economy in joint largest fall since 1979 after dropping 2.2% at start of year

Mirror logo Mirror 30/06/2020 James Andrews
a man wearing a suit and tie: The economy tanked in the first three months of the year © Getty The economy tanked in the first three months of the year

The UK economy contracted by more than first thought between January and March, dropping 2.2% in the joint largest fall since 1979, the Office for National Statistics (ONS) has said.

Jonathan Athow, deputy national statistician at the ONS, said: "Our more detailed picture of the economy in the first quarter showed GDP shrank a little more than first estimated.

"This is now the largest quarterly fall since 1979.

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"Information from Government showed health activities declined more than we previously showed.

"All main sectors of the economy shrank significantly in March as the effects of the pandemic hit.

"The sharp fall in consumer spending at the end of March led to a notable increase in households' savings."

a person standing in front of a store: Cornavirus hit hard, and things weren't great before © PA Cornavirus hit hard, and things weren't great before

The full effects of lockdown look set to drive us far further into negative territory once they're accounted for.

The ONS said in April the economy plummeted an astonishing 25% - although added there was a lot of uncertainty around the numbers at the moment.

“April’s fall in GDP is the biggest the UK has ever seen, more than three times larger than last month and almost ten times larger than the steepest pre-covid-19 fall," Athow said.

"In April the economy was around 25% smaller than in February.

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“Virtually all areas of the economy were hit, with pubs, education, health and car sales all giving the biggest contributions to this historic fall.

“Manufacturing and construction also saw significant falls, with manufacture of cars and housebuilding particularly badly affected.

“The UK’s trade with the rest of the world was also badly affected by the pandemic, with large falls in both the import and export of cars, fuels, works of art and clothing.”

The Organisation for Economic Co-operation and Development (OECD) said Britain's economy was likely to slump by 11.5% in 2020 - but could contract by 14% if there is a second wave of Covid-19 later this year.

It said UK activity was set to suffer particularly badly, because of Britain's largely service-based economy.

The services sector, which includes financial services, retail, hospitality, real estate and tourism, makes up around three quarters of UK GDP and has been badly impacted by the lockdown restrictions to contain Covid-19.

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Stay at home as much as possible to stop coronavirus spreading - here is the latest government guidance. If you think you have the virus, don't go to the GP or hospital, stay indoors and get advice online. Only call NHS 111 if you cannot cope with your symptoms at home; your condition gets worse; or your symptoms do not get better after seven days. In parts of Wales where 111 isn't available, call NHS Direct on 0845 46 47. In Scotland, anyone with symptoms is advised to self-isolate for seven days. In Northern Ireland, call your GP.


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