GDP monthly estimate, UK: April 2021

• UK gross domestic product (GDP) is estimated to have grown by 2.3% in April 2021, the fastest monthly growth since July 2020, as government restrictions affecting economic activity continued to ease.
• The service sector grew by 3.4% in April 2021, with consumer-facing services re-opening in line with the easing of coronavirus restrictions and more pupils returning to onsite lessons.
• Output in the production sector fell by 1.3% in April 2021, the first fall since January 2021 as three of the four sectors contracted.
• Within production, mining and quarrying output contracted sharply, by 15.0%, in April 2021 because of planned temporary closures for maintenance of oil field production sites.
• The construction sector contracted by 2.0% in April 2021 following a strong March, with new work slowing down faster than repair and maintenance.
• April’s GDP remains 3.7% below the pre-pandemic levels seen in February 2020, however it is now 1.2% above its initial recovery peak in October 2020.

Monthly real gross domestic product (GDP) is estimated to have increased by 2.3% in April 2021, the third consecutive month of growth as coronavirus (COVID-19) restrictions continued to ease to varying degrees in England, Scotland and Wales. April 2021 growth was the fastest monthly growth since July 2020, when it grew 7.3%.

Overall, GDP grew by 1.5% in the three months to April 2021, mainly because of services output, boosted by strong retail sales over the three months.

Latest month on same month a year ago comparisons should be treated with caution given the impact of base effects on growth rates, because of the economic impact of the coronavirus pandemic throughout 2020. Such comparisons and growth rates can nonetheless be found in our data tables. In comparison with April 2020, monthly GDP in April 2021 is estimated to have grown by 27.6%.

Services output grew by 3.4% in April 2021 but remained 4.1% below its pre-pandemic level of February 2020. Consumer facing services grew by 12.7% as coronavirus restrictions eased throughout April, with levels recovering to their initial recovery peak in October 2020, as Figure 3 shows.

Retail sales volumes grew sharply in April 2021 with a monthly increase of 9.2%, reflecting the re-opening of all non-essential retail from 12 April in England and Wales and from 26 April in Scotland. Non-food stores provided the largest contribution to the monthly growth in April 2021 sales volumes, aided by strong increases of 69.4% and 25.3% in clothing stores and other non-food stores respectively. More detail can be found in the Retail sales, Great Britain: April 2021.

Accommodation service activities grew by 68.6% as caravan parks and holiday lets picked up, while food and beverage service activities grew by 39.0% as pubs, restaurants and cafes could serve customers in outdoor seating areas.

Other personal service activities (including hairdressing) grew by 63.5% in April 2021, as hairdressing re-opened in England on 12 April.

Figure 4 shows education output as the second main contributor to services growth in April 2021, growing 11.2%, as more pupils returned to onsite lessons in April. This contributed 0.72 percentage points to April 2021 monthly growth. Weighted attendance for April 2021 was approximately 93%, compared with 67% in March 2021, and 16% in February 2021.

National Accounts revisions policy means that January to March 2021 are currently closed for revisions until GDP quarterly national accounts: January to March 2021 is published on 30 June 2021. There are potential revisions to the profile of the months across the first quarter of 2021 because of updated attendance data, alongside the weighted impact of remote learners. When we are able to revise these estimates, we expect the growth in education in January to be weaker (currently negative 10.0%) and stronger in March (currently 8.6%). Overall it is expected that the education industry will remain in a broadly similar position across the quarter. However, the estimated level and change of education in April is still our best estimate of education activity in the month. Revisions to monthly profiles will be published in our Monthly GDP estimate, UK: May 2021, on 9 July 2021.

Growth in human health activities slowed down in April 2021, to 0.1% growth. Output levels remain at record highs driven by coronavirus testing and tracing and vaccine schemes across the UK.

Adjustments for NHS test and trace services and vaccine programmes in the UK

Adjustments have been applied to the volume data to estimate the impact on real GDP from the NHS test and trace services and vaccine programmes. These adjustments are applied to both the government expenditure data as well as output data, and are applied only to volume data because of the way ONS estimates the output of health services.

To calculate the adjustment, in line with the UK National Accounts revisions policy, we have used the latest available quarterly government data and applied indicative volume adjustments to preserve the growth within the health sector and its impact on the economy, rather than applying an adjustment to preserve the level which could give an incoherent growth.

Table 2 sets out the volume expenditure adjustments for January 2021 to April 2021 split between NHS test and trace services and the vaccine programmes. The reduction in NHS Test and Trace adjustment for April compared with March can be seen in the latest coronavirus daily testing data, which shows a reduction of approximately 22% of total tests between March and April 2021.

Not all of this extra volume expenditure will be seen in the output of the health industry as there are other industries involved in the production of the vaccines and various testing kits, as well as a number of service industries involved in the logistical process of delivering the programmes.

As in Table 2, these estimates are informed by the latest available data including in-year spending data – the available estimated cost to secure and manufacture vaccines for the UK and deploy vaccines in England and available testing and vaccination data and estimated imports. These are early estimates that will be refined as a new method is introduced later this year.

Overall, services output grew by 1.4% in the three months to April 2021. This was led by retail sales, which continued to accelerate in growth throughout the three months, partially offset by contraction in education as schools remained closed in February and some of March.

Production fell by 1.3% in April 2021, with contraction in three out of the four sectors as Figure 5 shows. This is the first fall since January 2021, when there was a fall of 1.9% as coronavirus restrictions were re-introduced.

Mining and quarrying contributed to most of April’s fall in production output, contributing negative 0.1 percentage points to gross domestic product (GDP) growth.

The manufacturing sector contracted slightly by 0.3%, following two months of growth. Five out of the 13 manufacturing sub-sectors fell. The largest contribution to the fall came from the manufacture of basic pharmaceutical products and pharmaceutical preparations (which fell by 16.0%, returning to levels last seen in 2019) and the manufacture of transport equipment (which fell by 2.8%). More detailed breakdowns are available in the Index of Production, UK: April 2021.

Mining and quarrying output contracted by 15.0% in April 2021 mainly because of an 18.2% fall in extraction of crude petroleum and natural gas. Planned temporary closures for maintenance of oil field production sites were an important factor in April’s low output, while latest trade figures point to a fall in fuels exports.

Overall, output in the production sector increased by 0.5% in the three months to April 2021, driven by manufacturing (in particular, of manufacturing of computer, electronic and optical products), partly offset by the large fall in mining and quarrying in April 2021.

Construction output fell by 2.0% in April 2021, following exceptionally strong growth in March. This is the first fall in construction since December 2020, when it fell by 2.2%.

The fall in construction output in April 2021 was driven by both a fall in new work (2.9%) and repair and maintenance (0.6%). Despite April’s fall, construction remains slightly above February 2020 levels (0.3%). Further detail on the contributions to construction growth can be found in Construction output in Great Britain: April 2021.

The construction sector expanded by 5.1% in the three months to April 2021 because of a 5.2% increase in new work and 4.9% increase in repair and maintenance.

The increase in new work (5.2%) was because of growth in all new work sectors apart from private industrial work, which fell by 3.6%, with the largest contributor to growth being private commercial new work which grew by 7.4%. The increase in repair and maintenance (4.9%) in the three months to April 2021 was because of growth in non-housing and private housing repair and maintenance, which grew by 6.2% and 6.6% respectively, and offset the 4.7% fall in public housing repair and maintenance.

Contribution to growth

Contribution to growth indicates how many percentage points a sector or industry is adding or removing from a given growth rate, usually headline GDP growth.

Gross domestic product (GDP)

A measure of the economic activity produced by a country or region. Gross domestic product (GDP) growth is the main indicator of economic performance. There are three approaches used to measure GDP:

• the output approach
• the expenditure approach
• the income approach

Index numbers

Data relative to a given base value, which typically refers to a year.

Rolling three-month growth

Rolling three-month growth takes the average level of three consecutive months (for example, April, May, and June), and compares it with the average level of the previous three months (for example, January, February, and March). The rolling three-month growth rate is often used alongside the monthly growth rate, as the latter can be more volatile.

For further definitions, please see the Glossary of economic terms.

This release captures the direct effects of the coronavirus (COVID-19) pandemic and the government measures taken to reduce transmission of the virus. We have faced an increased number of challenges in producing estimates of UK gross domestic product (GDP) and because of these challenges, GDP estimates for April 2021 are subject to more uncertainty than usual.

Early in the pandemic we faced some challenges in receiving timely responses to the monthly business survey as businesses adapted to new conditions. In recent months, response rates have improved and further information on measuring the data across our main data sources is available in the following releases:

• Construction output in Great Britain: April 2021
• Index of Services, UK: April 2021
• Index of Production, UK: April 2021

In Blue Book 2021 a new framework will be introduced to improve how we produce volume estimates of GDP for balanced years as part of the supply use process. This framework includes the implementation of double-deflated industry-level gross value added for the first time. This improvement will be reflected in the September quarterly national accounts and October monthly GDP estimates. On 28 June we will publish Blue Book 2021 indicative impacts of this change to industry level gross value added volume.

This release gives data for April 2021 for the first time, with no periods open for revisions.

Quality and methodology information on strengths, limitations, appropriate uses, and how the data were created is available in the Gross domestic product (GDP) QMI.

The monthly growth rate for GDP is volatile. It should therefore be used with caution and alongside other measures, such as the three-month growth rate, when looking for an indicator of the medium-term trend of the economy. However, it is useful in highlighting one-off changes that can be masked by three-month growth rates.

Communicating gross domestic product

Recent analysis explains our latest position on how we are looking to communicate GDP, including how we will continue to acknowledge that “technical” recessions are comprised of at least two consecutive quarters of contracting GDP.

While it is still true that these early estimates are prone to revision, we prefer to focus on the magnitude of the contraction that has taken place following the COVID-19 pandemic. It is clear that the contraction in GDP in Quarter 2 (Apr to June) 2020 was in the largest recession on record. Our latest estimates show that the UK economy is now 3.7% smaller than it was in February 2020, the effects of which have been most pronounced in those industries that are most exposed to public health restrictions and the effects of social distancing.