UK economy contracts 2% amid Covid-19 crisis; lockdown norms relaxed

The UK’s economy shrunk 2 per cent in the first three months of the year till the end of March, the biggest quarterly decline since the global financial crisis of 2008, reflecting the financial effects of the coronavirus-induced economic lockdown.

“The impacts of the coronavirus were seen right across the economy, with nearly all sub-sectors falling in the three months to March,” the Office for National Statistics (ONS) said on Wednesday.

The fall was the biggest since the financial crisis of 2008 and included a contraction of 5.8 per cent in the March GDP alone, the biggest monthly fall on record, according to the latest statistics from the ONS.

There was zero growth in the final quarter of 2019, with the UK’s dominant services sector hit by a record decline. “This is the largest quarterly contraction since the global financial crisis and reflects the imposing of public health restrictions and voluntary social distancing put in place in response to the COVID-19 pandemic,” the ONS said.

The figures include a 1.9 per cent fall in the services sector — which accounts for around 80 per cent of the UK’s GDP — a 2.1 per cent fall in production and 2.6 per cent fall in construction.