UK economy hit by worst contraction in 41 years as it tumbles 2.2% in the first quarter

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Britain’s economy slumped even faster than originally feared during the first three months of the year, official figures reveal today.

The Office for National Statistics (ONS) now believes that GDP fell 2.2 per cent between January and March – the first month of the lockdown – compared with its initial estimate of two per cent.

That would make it the deepest quarterly contraction since the summer of 1979 at the start of the recession that followed the election of Margaret Thatcher as Prime Minister.


It is the joint third largest quarterly contraction in output ever recorded.

However, it is likely to be dwarfed by the expected downturn in the second quarter of the year, which includes a month of full lockdown in April when GDP plummeted by 20.4 per cent.

The slow pace of the recovery since lockdown began to be lifted in May and June was underlined by seperaate figures showing that Britain’s struggling high streets are still being visited by less than half the usual number of shoppers two weeks after ‘non essential’ stores were allowed to reopen in England.

Footfall in town and city centres was down 58.1 per cent on last year during the second week of the retail return, according to latest figures.

The lukewarm response from shoppers will raise fresh concern about the prospects for dozens of high streets, many of which were facing a bleak future even before the coronavirus pandemic hit.

Shopping centres are even emptier with footfall down 60.7 per cent on pre-lockdown levels a year ago, according to the data from the British Retail Consortium and analysts ShopperTrak.

Last week Britain’s biggest shopping centre operator Intu collapsed into administration.

However, there was a stronger bounceback at retail parks where numbers of shoppers were down only 28.4 per cent on the year.

BRC chief executive Helen Dickinson said: “Reopening is no silver bullet. Low consumer confidence and social distancing mean footfall is unlikely to return to pre-crisis levels anytime soon. Without further increases in demand to drive consumer spending, many retailers will struggle to make ends meet, putting stores and jobs at risk.”

Source Article from https://www.standard.co.uk/business/gdp-uk-coronavirus-ons-a4483916.html

June 30, 2020 |
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