Doomsayers ‘proved wrong’: UK had third-fastest Covid recovery in G7, revised GDP data now shows
The UK economy is no longer thought likely to be an outlier among the G7 nations with the worst post-pandemic recovery, after revised GDP figures were published.
Data from the Office for National Statistics (ONS) had previously indicated the UK’s finances had suffered greatly from the impact of the Covid-19 pandemic and the Ukraine war.
However, revised figures today show the UK economy was in a better position than previously thought – with gross national product (GDP) growth figures up 0.6 per cent on pre-pandemic levels by the fourth quarter of 2021.
It means the UK at that point had the third fastest G7 recovery, behind the US and Canada.
Chancellor Jeremy Hunt said: “The fact that the UK recovered from the pandemic much faster than thought shows that once again those determined to talk down the British economy have been proved wrong.”
Craig McLaren, ONS head of national accounts, said the “updated and indicative GDP estimates show the economy was larger than we previously thought in 2020 and 2021”.
But he stressed estimates for UK monthly and quarterly trends was “broadly unchanged”.
Unprecedented events including coronavirus and the Russian invasion had seen “the biggest fall in GDP ever” and the fastest price rises in four decades, McLaren explained.
Shock occurrences “added increased levels of uncertainty” to initial projections, he said, as number crunchers had less reliable data about firms’ costs, and had to rely on experimental VAT figures for forecasts. But now yearly surveys are complete, more detail is available.
The fresh information has indicated that many manufacturers incurred higher costs than the ONS thought, while wholesale and retail service prices were lower.
More health services were provided than previously thought, and UK company stock levels or ‘inventories’ fell by less than was estimated, which has reduced the scale of the GDP fall.
The ONS would continue reviewing its methods, McLaren said, adding: “We are among the first of our international colleagues to update our initial estimates with more detailed data.”
Hunt added: “There are many battles still to win, most of all against inflation so we can ease cost of living pressures on families.
“But if we stick to the plan we can look forward to healthy growth which according to the IMF will be faster than Germany, France, and Italy in the long term.”