GDP monthly estimate, UK: August 2019

Gross domestic product (GDP) measures the value of goods and services produced in the UK. It estimates the size of and growth in the economy.

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Dyddiad y datganiad:
10 October 2019

Cyhoeddiad nesaf:
11 November 2019

1. UK GDP grew by 0.3% in the three months to August 2019

Commenting on today’s GDP figures, Head of GDP Rob Kent-Smith said:

"Growth increased in the latest three months, despite a weak performance across manufacturing, with TV and film production helping to boost the services sector."

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2. Services was the main driver to rolling three-month GDP growth in August 2019

The main contributor to gross domestic product (GDP) growth in the three months to August 2019 was the services sector, which grew by 0.4%. This was driven by widespread strength across the services industries in June and July, following a period of largely flat growth in the previous three months. Meanwhile, the production sector fell by 0.4% in the same period, while construction output grew by 0.1%.

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3. Rolling three-month growth was 0.3% in the three months to August 2019

Rolling three-month growth was 0.3% in August 2019. This followed a period of volatility throughout the first half of 2019, in part linked to changes in the timing of activity around the originally planned departure date of the UK from the European Union.

Rolling three-month growth is based on output gross value added (GVA) and so there will be discrepancies in the time series with our quarterly estimates of gross domestic product (GDP), which include information on the expenditure and income approaches to measuring GDP.

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4. GDP fell by 0.1% in August 2019

Monthly gross domestic product (GDP) growth was negative 0.1% in August 2019, following growth in both June and July 2019.

This release incorporates revisions to monthly data for the entire time series, consistent with the Quarterly national accounts published in September 2019. Overall, revisions to monthly GDP growth were small. However, both June and July 2019 have been revised up by 0.1 percentage points, giving extra strength to the most recent rolling three-month estimate.

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

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5. The services sector grew by 0.4% in the three months to August 2019

Rolling three-month services growth was 0.4% in August 2019, following growth of 0.3% in July 2019. The main contributor to services growth in the three months to August was the professional, scientific and technical sector, which experienced broad-based growth across its sub-industries. However, the sub-industry that had the largest contribution to gross domestic product (GDP) growth was motion pictures (including TV and music), which has been one of the best performing sectors over the last year, growing at a notably faster rate than services as a whole (see Figure 3). More detail can be found in a previous article on the UK film industry.

In August, growth in services was flat, following growth of 0.2% in June and 0.3% in July 2019. The largest positive contributor to services growth was legal activities, which increased after several months of subdued growth, followed by wholesale and retail trade, and repair of motor vehicles. The largest negative contributors were employment activities, and food and beverage service activities.

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6. Production and manufacturing showed continued signs of weakness in the three months to August 2019

Rolling three-month growth in the production sector was negative 0.4% in August 2019, with growth in manufacturing at negative 1.1%.

There were widespread falls across manufacturing, offset partially by the manufacture of transport equipment, which is still seeing a bounce back from the weakness in April 2019 as a result of car production plants bringing forward their summer shutdowns. Despite this strength in the most recent period, the longer-term picture for the manufacture of transport equipment is one of weakening growth, as seen in Figure 4. Elsewhere, electricity, gas, steam and air conditioning supply performed well, growing by 3.2%.

Production fell by 0.6% in August 2019, following growth of 0.1% in July. Within production, manufacturing fell by 0.7%. This was driven largely by a fall-back in the often volatile manufacture of pharmaceuticals, following strong growth in July.

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7. Growth in the construction sector was 0.1% in the three months to August 2019

Rolling three-month growth in the construction sector was 0.1% in August 2019, following a fall of 0.9% in July. This growth was driven by private new housing, public housing repair and maintenance, and private commercial.

Month-on-month growth in construction was 0.2% in August 2019, following growth of 1.8% in July. The largest positive contributor to monthly growth was non-housing repair and maintenance, private commercial and public new housing.

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8. Things you need to know about this release

This release incorporates the revisions to the entire back series published in the Quarterly national accounts release on 30 September 2019. These data are consistent with the Blue Book 2019, which will be published on 31 October 2019.

A number of methodological changes have been made and improved source data have been used, in addition to revisions caused by taking on updated source data as would happen in all quarterly national accounts releases. Further details about the main changes affecting this release are provided in the latest Quarterly national accounts release, along with analysis of the revisions to each quarter from 2017 onwards.

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9. Quality and methodology

The Gross domestic product (GDP) Quality and Methodology Information report contains important information on:

  • the strengths and limitations of the data and how it compares with related data
  • uses and users of the data
  • how the output was created
  • the quality of the output including the accuracy of the data
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James Scruton
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