The UK Is Officially In Recession Following Worst Ever Quarterly Slump
The UK is officially in recession for the first time since the 2008 financial crisis.
With the country plunging into the deepest slump on record, the government is attempting to find the balance between easing lockdown restrictions to help the economy recover and keeping the public safe.
Figures from the Office for National Statistics show that gross domestic product (GDP) - which simply put, means the total value of goods and services produced in a country - fell in the three months to June by 20.4 percent.
A recession is defined as two successive quarters of decline in GDP.
The Office for National Statistics said: "UK gross domestic product (GDP) is estimated to have fallen by a record 20.4 percent in Quarter 2 (Apr to June) 2020, marking the second consecutive quarterly decline after GDP fell by 2.2 percent in the previous quarter.
"This is the largest quarterly contraction in the UK economy since Office for National Statistics (ONS) quarterly records began in 1955, and reflects the ongoing public health restrictions and forms of voluntary social distancing that have been put in place in response to the coronavirus (Covid-19) pandemic.
Our latest GDP estimates for June show that the UK economy is now 17.2% smaller than it was in February before the full impacts of the #coronavirus #COVID19 pandemic hit https://t.co/8FmcVvX6lz pic.twitter.com/Qgh12prPtt- Office for National Statistics (ONS) (@ONS) August 12, 2020
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"In level terms, real GDP was last lower in Quarter 2 2003. Compared with the same quarter a year ago, the UK economy fell by 21.7 percent."
Commenting on the figures, ONS Deputy National Statistician for Economic Statistics, Jonathan Athow, said: "The recession brought on by the coronavirus pandemic has led to the biggest fall in quarterly GDP on record.
"The economy began to bounce back in June with shops reopening, factories beginning to ramp up production and housebuilding continuing to recover. Despite this, GDP in June still remains a sixth below its level in February, before the virus struck.
"Overall, productivity saw its largest fall in the second quarter since the three-day week. Hospitality was worst hit, with productivity in that industry falling by three quarters in recent months."
Economies across the world have been hard hit by the pandemic, but even then, the UK's latest quarterly slump has been severe.
The ONS said: "Compared with the end of 2019, the UK fell by a cumulative 22.1 percent in the first six months of 2020. This fall was slightly below the 22.7 percent seen in Spain but was more than double the 10.6 percent fall in United States GDP over this period.
"The larger contraction of the UK economy primarily reflects how lockdown measures have been in place for a larger part of this period in the UK compared with these other economies."
Featured Image Credit: PA
Topics: UK News