GDP monthly estimate, UK : February 2022

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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Cyswllt:
Email Niamh McAuley

Dyddiad y datganiad:
11 April 2022

Cyhoeddiad nesaf:
12 May 2022

1. Main points

  • Gross domestic product (GDP) grew by 0.1% in February 2022, following 0.8% growth in January 2022.

  • Services grew by 0.2% and was the main contributor to February's growth in GDP; this was partially offset by production, which fell by 0.6% and construction, which fell by 0.1%.

  • The services growth in February 2022 was mainly driven by tourism-related industries with increases in both travel agency, tour operator and other reservation service and related activities (growing 33.1% on the month), and accommodation (growing 23% on the month).

  • Output in consumer-facing services grew by 0.7% in February 2022, following 2.0% growth in January (revised up from 1.7%); non-consumer facing services remained level on the month following 0.5% growth in January (revised down from 0.6%).

  • Monthly GDP is now 1.5% above its pre-coronavirus (COVID-19) pandemic level (February 2020).

  • Services is now 2.1% above its pre-coronavirus level, while construction is 1.1% above and production is 1.9% below. Within services, consumer-facing services are now 5.2% below their pre-coronavirus levels, while all other services are 4.0% above.

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2. Monthly GDP

Monthly real gross domestic product (GDP) is estimated to have grown by 0.1% in February 2022 and is now 1.5% above its pre-coronavirus level (February 2020) (Figure 1). This release includes revisions to the monthly data back to January 2020, consistent with the Quarterly National Accounts published on 31 March 2022. For more information, see Section 7: Revisions to monthly GDP section.

Services grew by 0.2% and was the main contributor to February’s growth in GDP (Figure 2). This was partially offset by production, which fell by 0.6% and construction which fell by 0.1%.

Monthly gross domestic product in February 2022 was 1.5% above its pre-coronavirus (COVID-19) pandemic level. The main contributor to the recovery from February 2020 to February 2022 was human health and social work activities followed by professional, scientific and technical activities and information and communication. The largest drivers of negative growth between February 2020 and February 2022 were real estate activities and other service activities (Figure 3).

GDP grew by 1.0% in the three months to February 2022. Services was the main contributor in the three months to February, contributing 0.7 percentage points, while production and construction both contributed 0.1 percentage points each.

More about economy, business and jobs

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3. The services sector

Services output grew by 0.2% in February 2022 which followed 0.8% growth in January 2022. Services output is now 2.1% above its pre-coronavirus (COVID-19) pandemic level (February 2020). In February 2022, 8 of the 14 service sectors were above their pre-coronavirus levels, with the largest contribution from human health and social work activities (growing 9.8% from February 2020).

Accommodation and food service activities grew by 8.6% in February 2022 and was the main contributor to February’s growth in services (Figure 4). Within this sector, the main driver was accommodation, which grew by 23%. This partly reflected a bounce back following weakness in both January and December because of the impact of the Omicron variant of coronavirus (COVID-19). In particular, there was strength seen in hotels and camping grounds. February 2022 saw this sub-sector’s first positive growth since August 2021.

Administrative and support service activities was the second largest contributor to the growth in services, which grew by 2.7%. Within this sector, travel agency, tour operator and other reservation service and related activities was the main driver in this sector, growing by 33.1% with a reduction in COVID-19 restrictions having a positive effect on the tourism industry. This sector saw widespread positive growth in five of six sub-sectors, partially offset by security and investigation activities which fell by 3.1%.

The largest negative contributor to services growth in February 2022 was human health and social work activities (down 3.8%). Human health activities (down 5.1%) was the main driver of this fall, largely reflecting a fall back from high levels in NHS Test and Trace and vaccination activity in December and January. Elsewhere in this sector, there was widespread downward contributions from all other areas of human health and social work activities, including residential care activities, and social work activities without accommodation. Human health was also notably revised down in January 2022, driven mainly by new hospital activity data, for example in-year, non-elective surgery.

NHS Test and Trace services and vaccine programmes

The NHS Test and Trace and COVID-19 vaccination programme detracted 1.1 percentage points from gross domestic product (GDP) growth in February 2022. This was driven by large falls in both NHS Test and Trace (falling 47%) and the vaccination programmes (falling 65%), as shown in Table 1. It is important to note, though, that this follows particularly high levels of activity in December and January reflecting the vaccination booster campaign and high rates of infection from Omicron.

A full record of the volume estimates of NHS Test and Trace, and vaccination programmes along with their contribution to GDP growth can be found in the accompanying dataset.

Consumer facing services

Output in consumer-facing services grew by 0.7% in February 2022, following a 2.0% (revised up from 1.7%) growth in January. The February increase was mainly driven by 33.1% growth in travel agency, tour operator and other reservation service and related activities, following a growth of 1.4% in January 2022. This was partially offset by wholesale and retail trade and repair of motor vehicles and motorcycles, the largest negative contributor in consumer-facing services.

Consumer-facing services were 5.2% below their pre-coronavirus levels (February 2020) in February 2022, while all other services were 4.0% above.

Consumer-facing services were 5.2% below their pre-coronavirus levels (February 2020) in February 2022. The main driver of this industry remaining below pre-coronavirus levels was buying and selling, renting and operating of own or leased real estate (excluding imputed rent) contributing negative 3.03 percentage points (Figure 6).

Overall, services grew by 0.8% in the three months to February 2022 compared with the previous three months (September to November 2021), with positive growth seen in 9 of the 14 services sectors.

More detailed breakdowns on services are available in the Index of Services, UK: February 2022

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4. The production sector

Production output fell by 0.6% in February 2022, with negative growth in all four sub-sectors (Figure 7). This follows growth of 0.7% in January 2022.

Manufacturing was the main driver of negative growth, falling by 0.4% in February 2022. Contractions of 5.4% in manufacture of transport equipment (driven entirely by the fall in manufacture of cars), 4.3% in manufacture of computer, electronic and optical products, and 5.0% in manufacture of chemicals and chemical products were slightly offset by manufacture of basic pharmaceutical products and pharmaceutical preparations, which saw growth of 9.8%.

Electricity, gas, steam and air conditioning supply fell by 0.6% in February 2022, with electric power generation, transmission and distribution decreasing by 1.0%. Mining and quarrying fell by 3.2%, driven by falls in extraction of crude petroleum and natural gas (2.2%) and other mining and quarrying (10.9%). Water supply and sewerage decreased by 0.4%, with a recovery in sewerage (up 4.4%) not fully offsetting falls of 4.1% in waste collection, treatment and disposal activities, and 1.9% in water collection, treatment and supply.

Overall, production increased by 1.0% in the three months to February 2022, with growths of 1.7% in manufacturing, 0.1% in electricity, gas, steam and air conditioning supply, and 1.7% in water supply and sewerage. This was partially offset by a decrease of 6.6% in mining and quarrying.

More detailed breakdowns on production are available in the Index of Production, UK: February 2022.

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5. The construction sector

Construction output decreased 0.1% in February 2022 following an upwardly revised increase (by 0.5 percentage points) of 1.6% in January 2022.

Construction output was 1.1% above its pre-coronavirus (COVID-19) pandemic level (February 2020) in February 2022 (Figure 8).

The small decrease in monthly construction output in February 2022 was driven solely by a decrease in repair and maintenance (0.5%), while new work saw a small rise, increasing 0.1%.

At the sector level, six of the nine sectors saw a decline on the month in February 2022, with infrastructure new work the main contributor to the fall, decreasing 2.5% in February 2022. After performing strongly in the initial recovery from the pandemic, infrastructure new work has seen six monthly falls in growth in the last seven months.

These falls were partially offset by rises in public other new work and public housing repair and maintenance, which grew 10.5% and 3.6%, respectively.  

Anecdotal evidence received from the Monthly Business Survey - Construction and allied trades suggested the storms experienced between 16 and 21 February, 2022 (PDF, 116KB) resulted in projects being delayed as more working days were lost on sites and premises than normal for this time of the year. Some businesses, mainly smaller firms, also responded that sourcing construction products continued to be a challenge, however demand continued to be strong. This is illustrated with new orders in the construction industry growing 9.2% in Quarter 4 (Oct to Dec) 2021 compared with Quarter 3 (July to Sept) 2021 and all sectors recovering to above their pre-coronavirus level.

Construction output rose by 2.4% in the three months to February 2022 compared with the previous three months (September to November 2021). This is the strongest growth in the three-month on three-month series since June 2021 (4.0%).

Increases in both new work and repair and maintenance (2.2% and 2.6%, respectively) contributed to the growth. At the type of work level, seven of the nine sectors saw an increase, with the largest contributions coming from private new housing and non-housing repair and maintenance (5.1% and 4.4% respectively).

Further detail on construction growth rates can be found in Construction output in Great Britain: February 2022.

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6. Cross-industry themes

There were some common themes that were anecdotally reported to have played a part in performance across different industries, however, it is often difficult to quantify these effects.

Some businesses referenced the impact of storms Dudley, Eunice and Franklin, which all hit the UK between 16 and 21 February. Most of those reporting a negative impact were in service industries with comments received from businesses operating in areas including accountancy, leisure parks and holiday centres, photography, hairdressing and beauty, leasing of construction equipment, restaurants and takeaways, and marquee hire. However, some businesses reported a positive impact on turnover such as those working in fencing, torch sales, and temporary off-grid power.

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7. Revisions to monthly gross domestic product

This release gives data for February 2022 for the first time. It incorporates revisions to monthly data from January 2020 to December 2021, as published in the Quarterly National Accounts release on 31 March 2022. January 2022 is also open to revision, taking on updated survey data and seasonal adjustment reviews. Table 2 shows the revisions to monthly gross domestic product (GDP) and its sectors for October 2021 to January 2022, since the last monthly publication on 11 March 2022.

The next monthly GDP release, on 12 May 2022, will see revisions to January and February 2022 in line with the National Accounts Revision Policy. These revisions will be consistent with the first quarterly estimate of GDP release published on the same day, which will cover the period up to Quarter 1 (Jan to Mar) 2022.

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8. Monthly GDP data

Monthly gross domestic product by gross value added
Dataset | Released 11 April 2022
The gross value added (GVA) tables showing the monthly and annual growths and indices as published within the monthly gross domestic product (GDP) statistical bulletin.

Contributions to monthly GDP
Dataset | Released 11 April 2022
Contributions to growth within monthly gross domestic product (GDP), UK.

Monthly gross domestic product: time series
Dataset MGDP | Released 11 April 2022
Monthly estimate of gross domestic product (GDP) containing constant price gross value added (GVA) data for the UK.

Monthly GDP and main sectors to four decimal places
Dataset | Released 11 April 2022
Monthly index values for monthly gross domestic product (GDP) and the main sectors in the UK to four decimal places.

Revisions triangles for monthly GDP
Dataset | Released 11 April 2022
Comparison of gross domestic product (GDP) first estimates against estimates published later.

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9. Glossary

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 gross domestic product (GDP) growth.

Gross domestic product (GDP)

A measure of the economic activity produced by a country or region. 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.

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10. Measuring the data

This release captures the direct effects of the coronavirus (COVID-19) pandemic and the government measures taken to reduce transmission of the virus.

Early in the pandemic, we faced some challenges in receiving timely responses to the Monthly Business Survey (MBS) as businesses adapted to new conditions. Further information on measuring the data across our main data sources is available in the following releases:

There have been large movements in UK gross domestic product (GDP) over the course of the coronavirus pandemic. This is primarily in response to public health restrictions and voluntary social distancing that have been in place over this period. Given the size of these effects, there has been a focus on where the economy is relative to its pre-coronavirus pandemic levels.

In the UK, we produce estimates of monthly and quarterly GDP. However, there are reasons as to why these would not provide the same estimate as to where the economy is relative to its pre-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).

However, the coronavirus pandemic has brought many measurement challenges that have created more uncertainty around our three approaches. This has led to an initial divergence between the output and average estimate, which is then reflected in how we compare monthly and quarterly estimates of GDP. Further information is available in Measuring monthly and quarterly UK gross domestic product during the coronavirus (COVID-19) pandemic.

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 given the use of the Annual Business Survey in their compilation.

Within the monthly GDP publication government data are sourced on a quarterly basis; a monthly forecast is used to estimate data for the monthly round until quarterly data are available. While this is a standard practice with many of our data sources, pre-empting the behaviour of a series during a pandemic, in particular for health and education, comes with more uncertainty than usual so caution is advised when looking at the monthly estimates beyond the latest published quarter.

The Office for National Statistics (ONS) is aware of reclassifications or relocations of companies that may impact these published estimates of GDP and associated breakdowns. The ONS is monitoring the data and will seek to implement any resulting changes into the national accounts as soon as possible.

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11. Strengths and limitations

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.

The latest comparisons of month on same month a year ago should be treated with caution given the impact of base effects on growth rates because of the economic impact of the coronavirus (COVID-19) pandemic throughout 2020 and 2021. Such comparisons and growth rates can nonetheless be found in our accompanying dataset.

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 comprised 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 coronavirus pandemic. It is clear that the contraction in GDP in Quarter 2 (Apr to June) 2020 was the largest recession on record.

Consultation on ONS release times

The Office for Statistics Regulation (OSR) has finalised its consultation on release practices. The ONS has welcomed the findings in a statement on the ONS’s response to the OSR’s proposals, specifically noting that the release-time exemptions, which were granted during the pandemic, are now incorporated into the revised Code of Practice. As such, the monthly GDP release will continue to be published at 7am.

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Manylion cyswllt ar gyfer y Bwletin ystadegol

Niamh McAuley
gdp@ons.gov.uk
Ffôn: +44 1633 455284