GDP: UK heads towards double-dip recession as economy takes a hit from November lockdown
ITV News Economics Editor Joel Hills has more
The UK economy took a hit during England's Covid lockdown in November - shrinking by 2.6% - putting the country on course for a double dip recession.
The Office for National Statistics (ONS) said UK gross domestic product at the end of November was 8.5% below its pre-pandemic peak.
The latest figure brings an abrupt end to the six months of consecutive growth seen before November - with a 0.6% improvement in October - with GDP expected to fall further after a third lockdown took hold this month
Here's what's changed:
ITV News' Economics Editor Joel Hills described the fall as "better than expected," however, with the impacts of the second lockdown less destructive than the first.
His analysis also suggested the impact of staggered restrictions across the UK's four nations resulted in a "better than expected" outcome for the economy.
With England's lockdown beginning after Wales' two week circuit breaker, and both alongside tightened restrictions in Scotland and Northern Ireland.
The second lockdown was also "much less painful than the first," Joel Hills reports with he construction sector returning to pre-crisis size, and output up in warehousing, postal and courier services.
Economists have warned the UK is set to see a double-dip recession if restrictions remain in place in the first three months of 2021.
England's current lockdown is set to be reviewed in mid-February, while Scotland, Wales and Northern Ireland are all under strict Covid restrictions.
Darren Morgan, director for economic statistics at the ONS, said England's second national lockdown "took a hit" from restrictions, "with pubs and hairdressers seeing the biggest impact."
“"However, many businesses adjusted to the new working conditions during the pandemic, such as widespread use of click and collect as well as the move online," Mr Morgan added.
"Manufacturing and construction generally continued to operate, while schools also stayed open, meaning the impact on the economy was significantly smaller in November than during the first lockdown.
"Car manufacturing, bolstered by demand from abroad, housebuilding and infrastructure grew and are now all above their pre-pandemic levels."
Jeremy Thomson-Cook, chief economist at Equals Money, said: "The services sector remains the hardest hit, and naturally the most valuable to the UK economy as a whole.
"Given conditions were lighter in November – lower tiers, more businesses able to trade at some level – today’s numbers confirm that Q4 2020 will be the first quarter of the new double-dip recession."