Sunshine and Showers

Sunshine and Showers

max temp: 14°C

min temp: 10°C

ESTD 1874 Search

Economy: UK output back above pre-recession peak after 0.8% growth in second quarter GDP

09:57 25 July 2014

Chancellor of the Exchequer George Osborne.

Chancellor of the Exchequer George Osborne.

Archant

Britain has finally emerged from its worst post-war downturn after growth of 0.8% in the second quarter of 2014 took the size of the economy above its pre-recession peak.

The performance left the UK’s gross domestic product (GDP) 0.2% ahead of its level at the start of 2008, the Office for National Statistics (ONS) said.

It marks the end of a period when GDP slumped to 7.2% below its pre-recession levels by the middle of 2009.

The stuttering recovery did not take flight until last year when growth began to accelerate.

But Britain is now predicted to be the fastest growing major world economy in 2014. Yesterday the International Monetary Fund (IMF) raised its GDP forecast for the fourth time in a row to 3.2%.

Commenting on the figures, Chancellor George Osborne said: “Thanks to the hard work of the British people, today we reach a major milestone in our long-term economic plan.”

Today’s figures showed that GDP was 3.1% higher in the second quarter compared with the same period a year ago, the highest such year-on-year increase since the last quarter of 2007.

The 0.8% growth for the second quarter, which was widely forecast, was primarily driven by the powerhouse services sector, which accounts for three-quarters of output, and grew by 1%.

But expansion in the manufacturing sector slowed to just 0.2% while construction shrank by 0.5%, dragged down by a weak May for builders. For both sectors it was the worst quarter since the start of 2013.

The figures mean that while the services sector is now 2.9% ahead of its level at the start of 2008, manufacturing is still 7.4% behind and construction lagging by 10.7%.

The continuing pace of the recovery, with growth maintaining the pace of the first three months of the year, will feed into expectations about the timing of an interest rate rise. Accelerating signs of economic improvement have seen these brought forward.

However, critics of the Coalition point to evidence that it is not yet filtering through to ordinary households as real terms pay is falling.

Latest figures show while employment levels are improving strongly, pay growth has fallen to just 0.3%, lagging well behind inflation at 1.9%.

Opponents of the Government also point to the measure of GDP per head, which in the first quarter of this year was 5.5% below the peak. The measure for the second quarter is not yet available.

Search hundreds of local jobs at Jobs24

2 comments

  • i wish i could see my bank account change so easy.

    Report this comment

    TERENCE MANNING

    Saturday, July 26, 2014

  • Osborne has been 're adjusting' the figures again !, you can make 'statistics' say exactly what you want them to say if you 'present' them in the right way !. there are 'Lies, Damned Lies and then Statistics' !

    Report this comment

    freedomf

    Friday, July 25, 2014

The views expressed in the above comments do not necessarily reflect the views of this site

Dr Donald Gilbert of ProSynth receiving the company's Queen's Award fom Clare, Countess of Euston, Lord Lieutenant of Suffolk.

A Suffolk company which provides complex chemistry services for research and development work at some of the world’s leading pharmaceutical companies was yesterday presented with the Queen’s Award for Enterprise.

The East of England Co-op has put in a planning application to demolish the building as part of a regeneration project.

The East of England Co-op has announced plans to demolish an unused building in Ipswich which will pave the way for more regeneration.

From left, apprentices Bethany Brame, Lydia Lloyd-Potts and  Josephine Brady, Greene King chief executive Rooney Anand, Robert Halfon MP and Jo Churchill MP.

Skills minister Robert Halfon MP has praised the commitment of Bury St Edmunds-based pubs and brewing group Greene King to apprenticeships.

Greenpeace has published a list of the UK's top 100 recipients of European Union farming subsidies.

A number of East Anglian estates and farm businesses are among those receiving hundreds of thousands of pounds under the European Union’s Common Agri-cultural Policy (CAP), according to analysis by environmental group Greenpeace.

Alton Towers in Staffordshire, whose owner, Merlin Entertainments, says it has

Alton Towers owner Merlin Entertainments said today it had “learned every lesson” from last year’s Smiler rollercoaster crash as it revealed that visitor numbers are still being affected.

HOT JOBS

Show Job Lists

Most read

Most commented

Topic pages

Streetlife

Newsletter Sign Up

Sign up to the following newsletters:

MyDate24 MyPhotos24