GDP monthly estimate, UK: December 2023

• Real gross domestic product (GDP) is estimated to have fallen by 0.3% in the three months to December 2023, compared with the three months to September 2023.

• On a quarterly basis, this gives two consecutive falls in GDP, with a fall of 0.3% in Quarter 4 (Oct to Dec) 2023 following an unrevised fall of 0.1% in Quarter 3 (July to Sept) 2023. For further details, see our GDP first quarterly estimate: October to December 2023 bulletin.

• Monthly GDP is estimated to have fallen by 0.1% in December 2023, following a growth of 0.2% in November (revised down from 0.3% growth) and a fall of 0.5% in October (revised down from a 0.3% fall).

• Services output fell by 0.1% in December 2023, and in the three months to December 2023 services output fell by 0.2%.

• Production output grew by 0.6% in December 2023, but in the three months to December 2023 production output fell by 1.0%.

• Construction output fell by 0.5% in December 2023, and in the three months to December 2023 construction output fell by 1.3%.

• Output GDP is estimated to have annual growth of 0.4% in 2023 compared with 2022; this figure is measured differently to the 0.1% annual growth in 2023 in our GDP first quarterly estimate for October to December 2023, which uses average GDP.

Real gross domestic product (GDP) is estimated to have fallen by 0.3% in the three months to December 2023, compared with the three months to September 2023. All main sectors fell in this period: services output by 0.2%, production output by 1.0%, and construction output by 1.3%.

On a quarterly basis this gives two consecutive falls in GDP, with a fall of 0.3% in Quarter 4 (Oct to Dec) 2023 following an unrevised fall of 0.1% in Quarter 3 (July to Sept) 2023. For further details, see our GDP first quarterly estimate: October to December 2023 bulletin.

Monthly GDP is estimated to have fallen by 0.1% in December 2023, following growth of 0.2% in November 2023 (revised down from a 0.3% growth in our previous publication) and a fall of 0.5% in October 2023 (revised down from a fall of 0.3% in our previous publication). For an overview of revisions in this release, see Section 7: Revisions to monthly GDP.

It is important to note that early estimates of GDP are subject to revision (positive and negative). For more information, see our Why GDP figures are revised article.

Output in services fell by 0.1% in December 2023 and was the largest contributing sector to the fall in monthly GDP. Production output grew by 0.6% on the month, while construction fell by 0.5%.

GDP is estimated to have shown no growth in December 2023 compared with the same month last year. Looking more broadly, GDP is estimated to have fallen by 0.3% in the three months to December 2023 compared with the three months to December 2022.

Annual output GDP growth is estimated to be 0.4% in 2023. This figure is measured differently to the 0.1% annual growth in 2023 in our GDP first quarterly estimate: October to December 2023 bulletin, which uses average GDP. Services output grew by 0.3% in 2023 and was the largest contributor to output GDP annual growth over this period. Production output fell by 0.3% in 2023 and construction output grew by 2.0% in 2023.

This release includes revisions to monthly data from January 2023 to November 2023 and is consistent with the output data in our GDP first quarterly estimate: October to December 2023 bulletin published on the same day. For an overview of revisions in this release, see Section 7: Revisions to monthly GDP.

Overall, the services sector is estimated to have fallen by 0.2% in the three months to December 2023 compared with the three months to September 2023, with 8 of the 14 subsectors declining over this period.

The largest negative contributors to services output in this three-month period were:

• a fall of 0.6% in the wholesale and retail trade; repair of motor vehicles and motorcycles subsector

• a fall of 0.8% in education

• a fall of 2.4% in other service activities

These falls were partially offset by growth in 5 of the 14 services subsectors over the same period, with the largest positive contribution coming from growth of 0.6% in administrative and support service activities.

On the month, services output is estimated to have fallen by 0.1% in December 2023 following a growth of 0.2% in November 2023 (revised down from a 0.4% growth in our previous publication). Of the 14 subsectors, 8 experienced falls on the month. Figure 3 shows both the monthly and the three-month contributions from the services sector to gross domestic product (GDP) in December 2023.

The main driver to the 0.1% monthly fall in services in December 2023 was wholesale and retail trade; repair of motor vehicles and motorcycles, which saw a 1.9% fall on the month. This followed growth of 0.4% in November 2023. Two of the three industries within wholesale and retail trade; repair of motor vehicles and motorcycles fell in December 2023, with the largest contributor coming from retail trade, except of motor vehicles and motorcycles, which fell by 3.2%. For more information, see our Retail sales, Great Britain: December 2023 bulletin.

Human health and social work activities fell by 0.9% in December 2023 following growth of 0.2% in November 2023. Human health activities fell by 1.4% and was the largest contributor to this fall in December 2023. In December 2023 there were three days of industrial action by junior doctors and hospital dental trainees after no industrial action took place in November 2023. During the industrial action in December 2023, 86,329 inpatient procedures and outpatient appointments were rescheduled as reported by NHS England.

Education also saw a fall on the month, down by 1.0%, with attendance levels at schools dropping compared with November 2023.

These falls were partially offset by a monthly growth of 1.7% in professional, scientific and technical activities, where six of the eight subsectors saw growth on the month. The largest contributions came from architectural and engineering activities; technical testing and analysis (up 3.4%), legal activities (up 2.6%) and scientific research and development (up 3.8%).

An overview of data sources used in our estimates of service output can be found in our GDP(o) data sources catalogue.

The monthly business survey (MBS) is used for 42.9% of the services sector by industry weight. In December 2023 the turnover response rate for the MBS element of the services sector was 80.9%. We would expect this to increase over time as more responses are received, and any new data will be included in future monthly GDP releases. For context, the average turnover response rate for the services sector in 2022 now stands at 97.0%.

Consumer-facing services

Consumer-facing services fell by 0.7% in the three months to December 2023 compared with the three months to September 2023. The largest contribution to the fall over this period were falls of 2.1% in food and beverage service activities, 0.9% in retail trade, except of motor vehicles and motorcycles, and 3.4% in the other personal service activities industry.

Output in consumer-facing services fell by 0.8% in December 2023, following growth of 0.7% in November 2023 (Figure 4). The largest negative contribution in December 2023 came from retail trade, except of motor vehicles and motorcycles, which fell by 3.2% as published in our Retail sales, Great Britain: December 2023 bulletin. The largest positive contribution to consumer-facing services in December 2023 came from accommodation, which grew by 3.6% in December 2023.

Consumer-facing services were 6.7% below their pre-coronavirus (COVID-19) levels (February 2020) in December 2023, with 10 of 13 industries lower (Figure 5).

Figure 5: Out of 13 consumer-facing service industries, 10 remain below their pre-coronavirus (COVID-19) pandemic levels (February 2020) in December 2023

Monthly consumer-facing services index, January 2019 to December 2023, UK

For more detailed breakdowns on services, see our Index of Services, UK: December 2023 bulletin.

Production output is estimated to have fallen by 1.0% in the three months to December 2023 compared with the three months to September 2023 (Figure 6). This was driven by a 0.9% fall in manufacturing, with 10 out of 13 manufacturing subsectors declining over this period. Electricity, gas, steam and air conditioning supply fell by 2.6%, mining and quarrying fell by 3.0%, and water supply, sewerage, waste management and remediation activities grew by 0.5% over the same period.

On the month, production output is estimated to have grown by 0.6% in December 2023, driven by growth in manufacturing output (Figure 6). This monthly growth in production follows a 0.5% growth in November 2023 (revised up from a 0.3% growth in our previous publication) and a fall of 1.4% in October (revised down from a fall of 1.3% in our previous publication).

Mining and quarrying output fell by 1.8% in December 2023, after growth of 0.5% in November 2023. The December fall was driven by a 1.9% decline in output in the extraction of crude petroleum and natural gas industry.

Electricity, gas, steam and air conditioning supply grew by 1.1% in December 2023 after a fall of 0.2% in November 2023. The largest positive contribution in December 2023 came from manufacture of gas; distribution of gaseous fuels through mains; steam and aircon supply with growth of 13.3%. This was the strongest growth in this industry since December 2021, following four consecutive monthly falls in August to November 2023.

Water supply, sewerage, waste management and remediation activities fell by 0.4% in December 2023, mainly driven by a 2.1% fall in waste collection, treatment and disposal activities; materials recovery.

Manufacturing grew by 0.8% in December 2023, with growth in 9 of the 13 subsectors, following growth of 0.8% in November 2023. The largest positive contributions in December came from manufacture of transport equipment (up 2.3%), basic pharmaceutical products and pharmaceutical preparations (up 3.0%), and manufacture of basic metals and metal products (up 1.4%). Both the monthly and three-month contributions are shown in Figure 7.

The monthly business survey (MBS) is used for 75.9% of the production sector by industry weight. In December 2023 the turnover response rate for the MBS element of the production sector was 79.7%. We would expect this to increase over time as more responses are received, and any new data will be included in future monthly gross domestic product (GDP) releases. For context, the average turnover response rate for the production sector in 2022 now stands at 96.9%.

For a full set of data sources used in monthly GDP, see our GDP(o) data source catalogue.

For more detailed breakdowns on production, see our Index of Production, UK: December 2023 bulletin.

Construction output is estimated to have fallen 1.3% in the three months to December 2023 compared with the three months to September 2023. New work decreased by 5.0% over the period, while repair and maintenance rose by 4.0%. Within new work, the largest contributor to the decrease came from private new housing, which decreased by 8.0%.

In December 2023, monthly construction output is estimated to have decreased 0.5% in volume terms. This is the third consecutive fall in monthly construction output. The decrease in monthly output in December 2023 came solely from a decrease in new work (1.1% fall), with repair and maintenance increasing on the month (0.4%).

Three out of the nine sectors saw a decrease on the month. The main contributors to the monthly decrease at the sector level were infrastructure new work, and private housing repair and maintenance, which decreased 6.4% and 1.1%, respectively.

Construction data are sourced from our Monthly Business Survey (MBS). For December 2023, the MBS turnover response rate for construction was 74.8%. We would expect this to increase over time as more responses are received, and any new data will be included in future monthly gross domestic product (GDP) releases. For context, the average turnover response rate in 2022 now stands at 94.5%.

For further details on construction output growth rates, along with new orders in the construction industry and construction output prices, see our Construction output in Great Britain: December 2023, new orders and Construction Output Price Indices, October to December 2023 bulletin.

There were some common themes that were anecdotally reported to have played a part in performance across different industries (as part of the Monthly Business Survey for production and services). However, it is difficult to quantify the exact impact.

Comments provided by businesses to the MBS for December 2023 suggested some industries may have been affected by changes in consumer behaviour this year in comparison with the previous year. For example, bringing forward expenditure to earlier months to take account of discounts. These industries include retail, wholesale, warehousing and postal and courier activities. Most of these sectors saw positive monthly growth in November 2023 followed by weakness in December 2023.

Similar to previous months, the lack of demand for construction products was also prevalent with monthly declines across mining and quarrying, manufacture of paints and varnishes, cement and plaster, and iron and steel in December 2023. This supports the three consecutive monthly falls in construction output across Quarter 4 (Oct to Dec) 2023.

The automotive industry saw increases in both the manufacturing and retail parts of the sector on the month in December 2023, and also strength across Quarter 4 2023. Anecdotal evidence to the survey suggest some of the supply side constraints experienced in the previous 12 to 18 months have reduced and helped the industry return to growth.

This release gives data for December 2023 for the first time and revisions to monthly data from January 2023 to November 2023, consistent with our Gross domestic product (GDP) first quarterly estimate: October to December 2023 bulletin published on the same day. Table 1 shows the revisions to monthly GDP and main sectors for 2023, since the last monthly publication on 12 January 2024.

In services, the revisions in October and November are because of higher quality quarterly estimates for non-market health and education replacing earlier monthly estimates, as well as some late and updated Monthly Business Survey (MBS) data within information and communication. Other revisions to services mainly arise from seasonal adjustment now that a complete year of data are available for 2023.

In production, the revisions are mostly from the manufacturing sector and can be attributed to late and updated MBS data and seasonal adjustment changes now that a complete year of data are available for 2023.

In construction, an improvement has been made to the repair and maintenance deflator from January 2023 onwards. Other revisions are the result of late and updated MBS data and seasonal adjustment changes now that a complete year of data are available for 2023.

The next monthly GDP release on 13 March 2024 will publish data for January 2024 for the first time and no periods will be open for revision, in line with the National Accounts Revisions Policy.

Further information on how we measure the data across our main data sources is available in the following releases:

• Construction output in Great Britain: December 2023, new orders and Construction Output Price Indices, October to December 2023 bulletin

• Index of Production, UK: December 2023 bulletin

• Index of Services, UK: December 2023 bulletin

The main data source for these statistics is the Monthly Business Survey (MBS), and response rates for each can be found in the following datasets:

• Construction response rates

• Index of Production response rates

• Index of Services response rates

The monthly Gross domestic product (GDP) data sources catalogue provides a full breakdown of the data used in this publication.

In the UK, we produce estimates of monthly and quarterly GDP. However, there are reasons why these would not provide the same estimate as to where the economy is relative to its pre-coronavirus (COVID-19) pandemic levels. This primarily reflects that monthly estimates of GDP are based on only the output measure of GDP, while quarterly estimates of GDP reflect the average of the three approaches (output, income and expenditure).

Estimates for the construction industry within monthly GDP will differ to those published in the construction output release as they account for both the outputs produced and inputs consumed by the industry. There are also some coverage differences because of the use of the Annual Business Survey in their compilation.

Consumer-facing services industry classification

The industry breakdown used for consumer-facing services is based on the UK Standard Industrial Classification (SIC).

The following list contains the full SIC names of industries included in consumer-facing services and their corresponding shortened industry name where this has been used in Figure 5:

• Wholesale and retail trade and repair of motor vehicles and motorcycles — Sales and repairs of motor vehicles

• Retail trade, except of motor vehicles and motorcycles — Retail except motor vehicles

• Rail transport

• Accommodation

• Food and beverage service activities — Food and beverage

• Buying and selling, renting and operating of own or leased real estate, excluding imputed rent — Real estate activities

• Veterinary activities

• Travel agency, tour operator and other reservation service and related activities — Travel and tourism activities

• Gambling and betting services

• Sports activities and amusement and recreation activities — Sports, amusement and recreation

• Activities of membership organisations

• Other personal service activities

• Activities of households as employers of domestic personnel — Households as employers of domestic personnel

Office for Statistics Regulation review of GDP

The Office for Statistics Regulation (OSR) have completed a review of the practices around the preparation and release of information about revisions to estimates of GDP in our Impact of Blue Book 2023 article released on 1 September 2023, as announced by the OSR on 6 September 2023. The outcome of this review can be viewed on the OSR website. This review covered:

• processes and quality assurance in making revisions to GDP

• potential improvements to early estimates of GDP enabled through enhanced access to data

• communication of revisions to GDP, the story behind the most recent set of revisions in particular, and uncertainty in early estimates of GDP

We published a response to the OSR review into GDP in January 2024, which was positively received by the OSR.

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

Monthly growth rates can be volatile. This indicator 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.