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GDP figures - Is the economy returning to full health?

ended 10. May 2024

According to official data released this morning, monthly real gross domestic product (GDP) is estimated to have grown by 0.4% in March 2024, following growth of 0.2% in February 2024 (revised up from 0.1% growth in our previous publication) and an unrevised growth of 0.3% in January 2024.

Real gross domestic product is estimated to have grown by 0.6% in the three months to March 2024, compared with the three months to December 2023.

On a quarterly basis, this gives growth of 0.6% in Quarter 1 (Jan to Mar) 2024, following declines of 0.3% in Quarter 4 (Oct to Dec) 2023 and 0.1% Quarter 3 (July to Sept) 2023. 

Services output grew by 0.5% in March 2024, following growth of 0.3% in February 2024 (revised up from 0.1% growth in our previous publication), and grew by 0.7% in the three months to March 2024; services output was the largest contributor to the growth in GDP on both the month and the three months to March 2024.

Production output grew by 0.2% in March 2024, following growth of 1.0% in February 2024 (revised down from 1.1% in our previous publication), and grew by 0.8% in the three months to March 2024.

Construction output fell by 0.4% in March 2024, following a fall of 2.0% in February 2024 (revised down from a 1.9% fall in our previous publication), and fell by 0.9% in the three months to March 2024.

The chancellor, Jeremy Hunt, said this morning that: “There is no doubt it has been a difficult few years, but today’s growth figures are proof that the economy is returning to full health for the first time since the pandemic.

As a small business owner, do you think the economy is returning to full health? How are you finding business right now?

8 responses from the Newspage community

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Samuel Mather-Holgate
Independent Financial Adviser at Mather and Murray Financial
Whilst it’s great to see the UK economy is more resilient that most economists thought, this is a hammer blow for mortgage holders. Coming only a day after the central bank signalled a path to lower rates, this indicates that the route to get there will take longer than expected. Growth in the economy could mean inflation stays higher for longer, that means no rate cuts this summer. Autumn is now the most likely time that homeowners will get a reprieve.
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Ken James
Director at Contractor Mortgage Services
Jeremy Hunt will likely leverage this situation to the Conservatives' advantage, painting a picture of the economy "returning to full health." However, these words ring hollow when many sectors are grappling with survival. With high streets dwindling and small businesses folding, the reality is far from the optimistic narrative Mr. Hunt portrays. There's still a considerable distance to cover before the UK can truly regain any semblance of "full health."
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Ben Perks
Managing Director at Orchard Financial Advisers
It's encouraging that Jeremy sees the economy as "returning to full health," but that sentiment doesn't align with the conversations I'm having daily with people. While it's reassuring to witness positive figures, I believe we're far from a point where Jeremy and his colleagues can start congratulating themselves. High interest rates are putting significant strain on borrowers, and it's crucial for the government to prioritize intervention, innovation, and improvement without delay.
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Scott Gallacher
Director at Rowley Turton
Whilst it's great to see positive numbers, the Chancellor is delusional to say that the UK is returning to full health. Speaking to clients, the real economy is a very mixed bag with some real challenges, especially in the construction sector. We've seen little growth since before the pandemic, and we're lagging way behind the USA and Canada.
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Justin Moy
Managing Director at EHF Mortgages
This marks a remarkable shift for our economy, likely driven in part by the favorable mortgage rate adjustments seen back in January, especially spurring activity among homebuyers. This surge in confidence encouraged consumers to invest in goods and services, buoyed by the promise of future improvements. However, recent months have brought a downturn in mortgage rates, significantly altering the mood for the worse. We're far from having a robust economy; the impact of high mortgages may unfold over the next 12 to 18 months, potentially turning this upswing into more of a temporary spike than a lasting trend.
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Simon Bridgland
Director at Charwin Private Clients
The chancellor needs to wake up to the pressure being felt across the country. Its agreed that the figures are a good sign of what might be to come, but this means we are only just out of recession, not close to full recovery. For small businesses, things are still very tough, costs have not reversed to pre-pandemic levels and wages bills have simply risen to blistering heights, so many would not agree with Jeremy Hunt at all. Until the wider public feel the pressure ease on their purses, the knock on effects wont ripple through to businesses who desperately need a far more liquid flow of money through the tills.
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Gary Bush
Financial Adviser at MortgageShop.com
Not quite a handbrake turn but it's impressive to see that the UK, despite the cost of living and interest rate concerns, is powering away from recession. On the flipside this could be a sign that the Bank of England go back to caution and hold rates higher for longer - which in our opinion would be a mistake.
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Graham Cox
Director at Bridging Hub
These are surprisingly good GDP figures, though they are boosted by a rising population and mask the fact that GDP per capita is still very poor. Wage growth is currently outstripping inflation, putting more money in people's pockets. However, I suspect this is simply a short-term lagging effect as a result of wage increases following inflation up and now following inflation down.