Britain hit by record recession in Q2

Britain's recession is its first since the 2008 global financial crisis.

13 August 2020 | Economics

Hospitality was worst hit, with productivity in that industry falling by three-quarters in recent months. - Jonathan Athow, Deputy national statistician: ONS

Britain's economy contracted by a record 20.4% in the second quarter with the country in lockdown over the coronavirus pandemic, official data showed yesterday.

“It is clear that the UK is in the largest recession on record,” the Office for National Statistics said.

Britain officially entered recession in the second quarter after gross domestic product (GDP) contracted by 2.2% in the first three months of the year.

The technical definition of a recession is two quarterly contractions in a row.

The ONS said that the contraction for the first six months of 2020 “was slightly below the 22.7% seen in Spain but was more than double the 10.6% fall in United States”.

It added that Britain's dire second quarter was driven by a 20% drop in output in April, “the biggest monthly fall on record reflecting ­widespread ... declines in output across the ­services, production, and ­construction industries”.

The economy is beginning to rebound, however, as the government eases its lockdown restrictions.

GDP output growth was 8.7% in June, the ONS said.

“The economy began to bounce back in June, with shops reopening, factories beginning to ramp up production and house-building continuing to recover,” noted Jonathan Athow, deputy national statistician as the statistics office.

“Despite this, GDP in June still remains a sixth below its level in February, before the virus struck.

“Overall, productivity saw its largest-ever fall in the second quarter. Hos­pitality was worst hit, with productivity in that in­dustry falling by three-quarters in recent months,” he added.

Britain's recession is its first since the 2008 global financial crisis.

The grim economic news comes despite unprecedented government interventions, including spending tens of billions of pounds on job support schemes in a bid to avoid mass layoffs.

The Bank of England (BoE) is meanwhile pumping out hundreds of billions of pounds in cash stimulus and has slashed its main interest rate to a record-low 0.1%.

ONS data released Monday showed that around 730 000 workers have been removed from the payrolls of British companies since March.

Announcements of job cuts have become a daily occurrence, with companies expected to pick up the pace of layoffs as the government's key employment support scheme ends in October.

The BoE expects the unemployment rate to shoot higher to around 7.5% by the end of the year from 3.9% currently.

The central bank forecasts also that the UK economy will have contracted by 9.5% for the whole of 2020.

It estimates that UK gross domestic product will rebound in 2021 by nine percent. – Nampa/AFP

Similar News

 

Government wage index increases in Q2

1 day - 25 September 2020 | Economics

PHILLEPUS UUSIKU The government wage index stood at 133.0 basis points during the second quarter of 2020, an increase of 0.9 percent, compared to an...

No English cucumbers will be imported

1 day - 25 September 2020 | Economics

ELLANIE SMITNo English cucumbers will be imported into Namibia until further notice. This was announced to horticulture producers earlier this week by Namibia Agronomic Board...

Economy loses nearly N$6bn in second quarter

1 day - 25 September 2020 | Economics

Jo-Maré Duddy WINDHOEKAbout N$5.7 billion less flowed through the economy in the second quarter due to the lockdown and related Covid-19 measures...

DBN Innovation Award winner makes strides

1 day - 25 September 2020 | Economics

PHILLEPUS UUSIKUWinner of the Development Bank of Namibia (DBN) 2019 Innovation Award, Pulsar Electronics, is making strides with a DBN enterprise development and support package...

Global income from work slashed by tenth

1 day - 25 September 2020 | Economics

Stephanie Nebehay - Income earned from work worldwide dropped by an estimated 10.7%, or US$3.5 trillion, in the first nine months of 2020, compared to...

World becoming less tolerant of migrants

1 day - 25 September 2020 | Economics

Emma Batha - The world is becoming less tolerant of migrants, according to a poll released on Wednesday as Europe prepared to unveil a new...

Govts urged to invest more in green cities

1 day - 25 September 2020 | Economics

Umberto Bacchi - From planting more trees to saving on energy use in old buildings, governments should look at greening their cities to create jobs...

Nairobi ramps up green efforts

1 day - 25 September 2020 | Economics

Wesley Langat - Peter Njeru used to live in central Nairobi's rundown Michuki Memorial Park because he had nowhere else to go. Now the 28-year-old...

Taxman moves ­deadline to March

2 days ago - 24 September 2020 | Economics

Jo-Maré DuddyMore than 10 000 companies which still haven't fully submitted their employee tax returns on the Integrated Tax Administration System (ITAS) portal have compelled...

Tax return deadline extended

3 days ago - 23 September 2020 | Economics

Jo-Maré Duddy - The ministry of finance this morning said the deadline to submit individual income tax returns has been extended to 1 March...

Latest News

Government wage index increases in...

1 day - 25 September 2020 | Economics

PHILLEPUS UUSIKU The government wage index stood at 133.0 basis points during the second quarter of 2020, an increase of 0.9 percent, compared to an...

No English cucumbers will be...

1 day - 25 September 2020 | Economics

ELLANIE SMITNo English cucumbers will be imported into Namibia until further notice. This was announced to horticulture producers earlier this week by Namibia Agronomic Board...

Millennials thrive in learning organisations

1 day - 25 September 2020 | People

Chaze NalisaMillennials, those born between 1981 and 1996, are dynamic, with a wealth of potential to contribute to the transition, sustainability and growth of an...

Attitude is everything

1 day - 25 September 2020 | People

Mariselle StofbergWith his people relationships and excellent communication skills, Chris Matthee understands the importance of listening and communicating clearly and with the appropriate level of...

Attitude is everything

1 day - 25 September 2020 | Banking

Mariselle StofbergWith his people relationships and excellent communication skills, Chris Matthee understands the importance of listening and communicating clearly and with the appropriate level of...

Without a trace

1 day - 25 September 2020 | Crime

ELLANIE SMIT WINDHOEKAs the family of Shannon Darlikie Wasserfall battles to deal with the trauma of her disappearance - without a trace - nearly...

DBN seeks interim replacement for...

1 day - 25 September 2020 | Business

OGONE TLHAGEWINDHOEKThe Development Bank of Namibia (DBN) will find a temporary replacement for its senior manager for corporate communications Jerome Mutumba until his return from...

Economy loses nearly N$6bn in...

1 day - 25 September 2020 | Economics

Jo-Maré Duddy WINDHOEKAbout N$5.7 billion less flowed through the economy in the second quarter due to the lockdown and related Covid-19 measures...

DBN Innovation Award winner makes...

1 day - 25 September 2020 | Economics

PHILLEPUS UUSIKUWinner of the Development Bank of Namibia (DBN) 2019 Innovation Award, Pulsar Electronics, is making strides with a DBN enterprise development and support package...

Load More