UK economic output diminished by 20.4% in the second quarter of 2020, the worst quarterly slump on record, driving the country into the deepest recession of any major global economy.
This crash in GDP around the April-June period, compared with the first quarter, is the worst since quarterly records started in 1955. Industries most exposed to government lockdown measures to contain the coronavirus pandemic — services, construction and production — saw record drops.
UK finance minister Rishi Sunak said, “Today’s figures confirm that hard times are here…hundreds of thousands of people have lost their jobs, and sadly in the coming months many more will. But while there are difficult choices to be made ahead, we will get through this, and I can assure people that nobody will be left without hope or opportunity.”
The Office for National Statistics said, “UK economic output reduced by a cumulative 22.1% around the first six months of 2020, a worse outcome than France, Germany and Italy, and double the 10.6% fall recorded in the United States.” “The larger contraction primarily reflects how lockdown measures have been in place for a larger part of this period in the UK.”
The UK economy heavily relies on services and household spending, which recorded reduction in the second quarter, as consumers that were holed up at home spent less money and saved more. Moreover, millions of workers were furloughed and a lot have now been laid off.
The UK government has failed to replicate most of the trade deals between the EU and third countries that will no longer benefit British exporters at the end of 2020.