UK economy grows 0.6% between April and June as it recovers from recession

LONDON -- Britain's economy continued its recovery from recession at the end of last year, with its GDP increasing by 0.6% between April and June, official figures showed Thursday.

The second-quarter economic growth, as measured by gross domestic product, recorded a 0.7% increase, following a similar expansion in the first quarter. This aligns with economists' predictions. The positive growth provides a welcome boost for the U.K.'s new Labour government, which has made rebuilding the nation's economy a key priority after a period of sluggish growth.

“The U.K. economy has shown strong growth for two consecutive quarters, following the period of weakness we witnessed in the final six months of last year,” said Liz McKeown, director of economic statistics at the Office for National Statistics.

The growth surge was primarily driven by the service sector, particularly in technology, scientific research, and legal services.

However, this positive trend was partially offset by some weaknesses in the retail sector and reduced output in the TV and film production industry. The ongoing Screen Actors Guild strikes in the U.S. in 2023 continue to impact production schedules in the U.K.

The U.K. economy entered a recession at the end of 2023 as GDP contracted by 0.3% in the final three months of last year. Data at that time indicated that all three primary sectors — services, industrial production and construction — experienced a decline.

Rachel Reeves , Britain's new Treasury chief, pledged last month to prioritize stimulating economic growth and reversing what she called “14 years of chaos and economic instability” under previous Conservative governments.

Some financial experts voiced concerns about a possible slowdown in economic growth in the coming months. The GDP remained stagnant in June, with a 0.1% decline in the service sector.

Others, including Peter Arnold, chief economist at Ernst and Young U.K., held a more optimistic outlook.

“EY anticipates that the economy will continue to grow at a respectable pace, although it is likely to struggle to maintain the above-average rates seen in the first half of 2024,” he stated.