UK Economy Slowed In Q3 Before Omicron Arrival
Data suggests that the UK economy recovered slower in the third quarter of the year before the emergence of the Omicron variant, despite the easing of covid restrictions over the summer.
According to the Office for National Statistics (ONS), gross domestic product (GDP) growth was revised from 1.3% to 1.1% in Q3. Performance from health industries and hairdressers was weaker and the energy sector contracted more in September than previous estimates had suggested.
Nonetheless, upward revisions to 2020 means GDP in the three months to the end of September was closer to pre-pandemic levels. It came in at just 1.5% below the final quarter for 2019, an improvement from the previous forecast of 2.1% below. It is now estimated that annual UK GDP in 2020 fell by 9.4%, compared with a previous 9.7% estimate.
The largest contributors to the Q3 increase, in output terms, were the arts, hospitality, entertainment, and recreation as covid restrictions eased during the period.
Production and construction, however, both fell, driven by weak electricity, gas, steam, and air conditioning supply following on from high levels in May 2021.