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HomeUK NewsBritain's economic recovery slowed to a near-standstill even before Omicron

Britain’s economic recovery slowed to a near-standstill even before Omicron

Britain’s economic recovery slowed to a near-standstill in October as a summer restaurant boom petered out and builders struggled with supply chains.

Gross domestic product (GDP) grew by just 0.1% suggesting that the bounce-back was running out of steam even before the arrival of the Omicron variant and new Plan B restrictions that could add further hurdles.

The figure from the Office for National Statistics (ONS) was lower than expected, following growth of 0.6% the month before, and leaves the size of the economy still 0.5% smaller than before the pandemic struck in February 2020.

The ONS pointed to a sharp fall in construction output as builders faces higher costs and delays in the supply of materials such as steel, glass, concrete and timber.

There was also a decline in restaurants after a strong summer, with a 7.5% fall in food and beverage services activities.

Growth was largely driven by a rise in face-to-face GP appointments while second-hand car sales and employment agencies at a time when new cars as well as workers in some sectors have become hard to find.

Chancellor Rishi Sunak said: “We’ve always acknowledged there could be bumps on our road to recovery, but the early actions we have taken, our ongoing £400bn economic support package and our vaccine programme mean we are well placed to keep our economy on track.

“We have still been recovering quicker than expected, with more employees on payrolls than ever before and redundancies remaining low.”

Alpesh Paleja, lead economist at the CBI, said: “Growth disappointed in October, reinforcing concerns about the resilience of the UK’s economic recovery to the Omicron variant and the impact of further restrictions.

“We need to create consistency in our approach and build confidence by reducing the oscillation between normal life and restrictions as we learn to live with the virus and its variants.”

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