Before Omicron hits, UK economic growth exceeds pre-pandemic size

Before Omicron hits, UK economic growth exceeds pre-pandemic size

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The UK economy surpassed pre-pandemic levels for the first time in November, helped by gains across all industries before the Omicron coronavirus variant hit the country.

Output rose 0.9% in the October-November period, accelerating strongly from a near stagnation last month, according to the Office for National Statistics. That was well above the 0.4% forecast by economists polled by Reuters.

Before the first Covid-19 restrictions, the increase pushed gross domestic product, or GDP, to 0.7% above February 2020 levels, suggesting the economy has fully regained the ground it lost during the pandemic.

Strong growth across all industries. The services sector, which accounts for about 80% of the economy, grew 0.7%, supported by a strong performance in the retail sector. Output rose more than expected by 1%, and the construction sector rebounded 3.5% from last month’s contraction.

However, these data predate the surge in Covid-19 infections and self-isolation associated with the spread of the Omicron variant.

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: “November’s GDP growth may reverse in December as Omicron hits the consumer services sector hard.”

Grant Fitzner, chief economist at ONS, said: “The month leading up to Omicron’s work with architects, retailers, couriers and accountants has been strong growth and a good month for the harvest.”

The construction sector has also recovered from months of weakness as many raw materials have become more readily available, he added.

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