GDP monthly estimate, UK: September 2021

• Gross domestic product (GDP) is estimated to have grown by 0.6% in September 2021 but remains 0.6% below its pre-coronavirus (COVID-19) pandemic level (February 2020).
• Services output grew by 0.7% in September 2021 as human health activities grew by 6.4%, mainly because of a large rise in face-to-face appointments at GP surgeries in England.
• Output in consumer-facing services fell by 0.6% mainly because of a 13.3% fall in the wholesale and retail trade and repair of motor vehicles and motorcycles, while all other services rose by 1.0%.
• Consumer-facing services are 5.5% below their pre-coronavirus (COVID-19) pandemic levels, while all other services are now 1.0% above.
• Production output decreased by 0.4% in September 2021, mainly because of a 4.1% fall in the distribution of gas, its fourth consecutive monthly fall following exceptionally high output levels in May 2021 when adverse weather conditions boosted supply.
• Construction output increased by 1.3% in September 2021 following two consecutive months of contraction, and the sector is now 1.0% below its pre-coronavirus pandemic level; growth in construction was driven by growth in repair and maintenance (1.2%) and new work (1.3%).
• GDP growth for July 2021 has been revised from a 0.1% fall to a 0.2% fall, while August 2021 has been revised from 0.4% growth to 0.2% growth; these revisions were mainly because of late survey data for the services industries.

Monthly real gross domestic product (GDP) grew by 0.6% in September 2021, and follows a revised 0.2% growth in August 2021 (down from 0.4% growth) and a revised 0.2% fall in July 2021 (down from a 0.1% fall).

Construction output grew by 1.3% in September 2021, following two consecutive months of contraction. Services output also grew in September 2021, increasing by 0.7% following broadly flat movements in July and August 2021. Production output fell by 0.4% in September 2021, after two consecutive months of growth. Overall, GDP remained 0.6% below its pre-coronavirus pandemic level (February 2020) in September 2021.

Overall, gross domestic product (GDP) grew by 1.3% in the three months to September 2021, mainly reflecting the performance of the services sector in September 2021. This growth largely reflects the gradual easing of coronavirus (COVID-19) restrictions to varying degrees in England, Scotland and Wales, including the reopening of accommodation and food service activities and arts, entertainment and recreation services, as well as a rise in underlying human health activities (for example, a rise in GP appointments) compared with the previous three months (April to June 2021).

More detail on the quarterly path can also be found in GDP first quarterly estimate, UK: July to September 2021.

Services output grew by 0.7% in September 2021 but remains 0.3% below its pre-coronavirus (COVID-19) pandemic level. This follows growth of 0.1% in August 2021 (revised down from 0.3% growth), and negative growth of 0.2% in July 2021 (revised down from negative 0.1% growth).

Human health and social work activities grew by 4.7% in September 2021 and was the main contributor to September’s growth in services (Figure 3). Human health activities grew strongly in September 2021, by 6.4%, mainly because of a large rise in face-to-face appointments at GP surgeries in England, following falls in July and August 2021. Human health activities remain at historically high levels, with June and July 2021 the only other occasions where output has been higher than September 2021. The NHS Test and Trace and vaccine programmes had a positive 0.2 percentage point impact on September’s gross domestic product (GDP) growth (see later in the section for more information on how we measure health).

Professional, scientific, and technical activities grew by 2.1% and was the second largest contributor to September’s growth in services. Growth in this industry was widespread in September 2021, with output growing in seven of its eight sub-industries. The main drivers to growth were legal activities (growing by 3.1%) with some businesses citing a rush to complete work before further changes to the stamp duty holiday, while accounting, bookkeeping, and auditing activities also saw strong growth of 3.0%.

Administrative and support activities grew by 2.2% and was the third largest contributor to September’s growth in services. Services to building and landscape activities was the main driver to growth in this industry (growing by 8.0%), partly because of strong demand from offices and schools. There was also strong output growth in office administrative, office support and other business support activities (3.2%).

Downward contributions to services growth included a 1.5% fall in wholesale and retail trade, driven by a 13.3% fall in the wholesale and retail trade and repair of motor vehicles and motorcycles. External indicators also suggest a weak car market in September, with the new car market recording its lowest September sales since at least 1998, according to the Society of Motor Manufacturers and Traders (SMMT).

There was also a downward contribution from a 2.3% fall in information and communication. There were falls in output in computer programming, consultancy and related activities (down 4.4%), in motion picture, video and TV programme production, sound recording and music publishing activities (down 11.9%) and in information service activities (down 8.6%).

Elsewhere, air transport continued to expand as coronavirus (COVID-19)-related travel restrictions eased, growing by 23.9% in September 2021, but remaining 73.3% below its pre-coronavirus pandemic level.

Consumer-facing services

Output in consumer-facing services fell by 0.6% in September 2021, following revised growth of 1.3% in August (Figure 4). The main drivers were a 13.3% fall in the wholesale and retail trade and repair of motor vehicles and motorcycles, and a 0.3% fall in retail trade. These falls were partially offset by growth in food and beverage service activities (3.8%), travel agency, tour operator and other related reservation services (18.4%, but growing from historically low levels), and rail transport (9.1%). Rail transport output remains 31.5% below its pre-coronavirus pandemic level.

Consumer-facing services are 5.5% below their pre-coronavirus pandemic levels (February 2020), while all other services are now 1.0% above them.

Overall, services grew by 1.6% in the three months to September 2021, mainly reflecting the gradual reopening of accommodation and food service activities and arts, entertainment and recreation services, as well as a rise in underlying human health activities (for example, a rise in GP appointments) compared with the previous three months (April to June 2021).

The downward revisions to headline GDP in July and August 2021 were because of small downward revisions in the output of services. These were because of information and communication growing at a slower rate than previously estimated, with July 2021 growth revised to 1.8% growth (down from 3.0% growth) and August 2021 growth revised to 0.4% (down from 2.1%), as later data were incorporated.

More detailed breakdowns on services are available in the Index of Services, UK: September 2021, while detail on the quarterly path can also be found in GDP first quarterly estimate, UK: July to September 2021.

Taking into account NHS Test and Trace services and vaccine programmes

Coverage adjustments have been applied to the volume data to estimate the impact on GDP from the NHS Test and Trace services and COVID-19 vaccine programmes, by incorporating new cost-weighted activity indicators.

The NHS Test and Trace adjustment for September 2021 was £1,400 million, up from £1,200 million in August as the number of coronavirus tests increased by approximately 30%. The vaccine programme’s adjustment for September 2021 was £200 million, down from £300 million in August as the number of coronavirus vaccinations fell by approximately 40%. Note that published adjustments are rounded to the nearest £100 million.

Overall, the total adjustment increased by £200 million in September 2021, to £1,700 million, and had a positive 0.2 percentage point impact on GDP growth.

For further information on the methodology behind these adjustments, please refer to the Measuring the economic output of COVID-19 testing, tracing and vaccinations, and a full record of health volume adjustments and their contribution to GDP growth can be found in the accompanying dataset.

Production output decreased by 0.4% in September 2021, with a fall across the four sectors (Figure 5). This follows two consecutive months of growth, with growth of 1.0% in August 2021 (revised up from 0.8%), and growth of 0.4% in July 2021 (revised up from 0.3% growth).

Electricity, gas, steam and air conditioning supply fell by 1.6% in September 2021 and was the main contributor to production’s fall. The distribution of gas fell for a fourth consecutive month, following exceptionally high levels in May 2021 (last higher in December 2001), mainly resulting from adverse weather conditions boosting demand for energy.

The manufacturing sector fell by 0.1% in September 2021, following revised 0.3% growth in August 2021 (down from 0.5% growth), with output decreasing in 6 out of the 13 manufacturing sub-sectors. Most of the contribution to manufacturing falling was because of a 5.1% decrease in the manufacture of transport equipment.

Output in the manufacture of motor vehicles fell by 8.2% in September 2021 (Figure 6), the largest fall since May 2021, following a revised 5.9% growth in August 2021 (down from 6.6%). There was also a fall in the sales and repair of motor vehicles (13.3%), the largest fall since January 2021, following a revised 0.1% fall in August 2021 (up from a 1.9% fall).

Mining and quarrying fell by 0.8% in September 2021. The extraction of crude petroleum and natural gas also fell slightly, by 0.9%, in September 2021, following strong growth in recent months because of the reopening of oil field production sites previously temporarily closed for planned maintenance. The extraction of crude petroleum and natural gas remains low by historical standards, with output 17.6% below its September 2019 level. Water supply also fell in September 2021, by 0.4%.

Overall, production grew by 0.8% in the three months to September 2021, mainly because of a 26.3% growth in mining and quarrying and a 1.5% increase in water supply. These increases were partially offset by a fall of 0.3% in manufacturing and a fall of 4.0% in electricity, gas, steam and air conditioning supply.

Revisions

July 2021 growth was revised up to 0.4% (from 0.3%) because of upward revisions to manufacturing and mining and quarrying. These revisions were mainly because of new data.

August 2021 growth was revised up to 1.0% (from 0.8%) because of upward revisions to the electric power generation, transmission and distribution, extraction of crude petroleum and natural gas, and the manufacture of basic pharmaceuticals and pharmaceutical preparations. These revisions were also mainly because of new data.

More detailed breakdowns on production are available in the Index of Production, UK: September 2021, while detail on the quarterly path can also be found in GDP first quarterly estimate, UK: July to September 2021.  

Construction output increased by 1.3% in September 2021 following two consecutive months of contraction. Output in August fell by 0.7% (revised down from a 0.2% fall) and July output fell by 1.2% (revised down from a 1.0% fall). These downward revisions were mainly because of late survey data.

The growth in monthly construction output in September 2021 was driven by an increase in repair and maintenance (1.2%) and new work (1.3%). At the sector level, the main drivers were non-housing repair and maintenance (increasing by 2.6%) and public other new work (increasing by 7.2%). These increases were partially offset by falls in public housing new work (falling by 6.5%) and public housing repair and maintenance (falling by 2.7%).

Construction output recently peaked to be 0.9% above its pre-coronavirus (COVID-19) pandemic level in April 2021 but in September 2021 is now 1.0% below its pre-coronavirus pandemic level (Figure 6). This reflects recent challenges faced by the construction industry from rising input prices and in delays to the availability of some construction products (notably steel, concrete, timber and glass).

In contrast to the monthly growth, construction output fell by 1.5% in the three months to September 2021. This was because of a 3.6% fall in repair and maintenance (mainly because of a 5.9% fall in non-housing repair and maintenance) and a fall of 0.3% in new work (with housing (both public and private), public other new work, and private commercial new work all falling).

Further detail on the contributions to construction growth can be found in Construction output in Great Britain: September 2021, new orders and Construction Output Price Indices, July to September 2021, while detail on the quarterly path can also be found in GDP first quarterly estimate, UK: July to September 2021.

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.

Supply chain of motor-vehicles

In September 2021, car retailers reported supply challenges as a result of the ongoing semi-conductor shortage, coupled with a decrease to the usual level of demand for new cars (see Figure 6). The limited supply of new cars is likely have had an impact on used car sales, reflected in the continued increase in prices of used cars (see our consumer price inflation time series).

More broadly, the supply chain issue initially caused by the semi-conductor shortage is now impacting other industries for example renting and leasing activities, which has seen a decrease in new car leases and lease renewals that would be typical of this time of year as a result of limited availability and price increases.

Overall, the trade and repair of motor vehicles is down 13.7% compared with pre-coronavirus pandemic level (February 2020).

CO2 challenges

In late September, there were external reports of challenges in the domestic production of carbon dioxide (CO2), with concern on what impact this may have across other industries that depend on it (for example, farming, the production of soft drinks, and food packaging). To determine whether any falls in output were from the widely reported CO2 shortage, we looked for evidence in industries that greatly depend on CO2 in their production chain and comments from the monthly business survey. Overall, our latest estimates do not suggest any obvious impact attributed to CO2 challenges in September 2021.

The manufacture of industrial gases, inorganics and fertilisers (that is, the sub-industry with main CO2 suppliers) fell by 1.3% in September 2021, though, this was its third consecutive monthly fall after exceptionally high levels of output in June 2021. Other industries dependent greatly on CO2 in their production chain did not show obvious signs of the impact of the CO2 challenges either. The manufacture of soft drinks, for example, increased in September by 2.4%, while the processing and preserving of meat and production of meat products was broadly flat. Furthermore, there were no comments in the monthly business survey citing CO2 challenges in September 2021.

Fuel sales

Automotive fuel sales volumes rose by 2.9% in September 2021 as demand towards the end of September increased sales. This is expected to be a short-term displacement of activity, with the bringing forward of consumer activity. September 2021 saw fuel sales volume surpass their pre-coronavirus pandemic levels (they are now 1.8% above their February 2020 levels). More information on retail sales can be found in Retail sales, Great Britain: September 2021.

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

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.

Early in the pandemic, we faced some challenges in receiving timely responses to the Monthly Business Survey (MBS) 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: September 2021, new orders and Construction Output Price Indices, July to September 2021
• Index of Services, UK: September 2021
• Index of Production, UK: September 2021

The UK National Accounts, The Blue Book: 2021 was published on 29 October 2021 introducing various improvements to how we produce volume estimates of gross domestic product (GDP), and these changes were taken on for the first time in last month’s GDP monthly release, published on 13 October 2021.

Note that estimates for the construction industry from this new approach (double deflation) 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.

Consultation on the Code of Practice for Statistics

On behalf of the UK Statistics Authority, the Office for Statistics Regulation (OSR) is conducting a consultation on the Code of Practice for Statistics, proposing changes to the 9:30am release practice. Please send comments by 21 December 2021 to: regulation@statistics.gov.uk.

Update to the System of National Accounts

As part of an update to the System of National Accounts, the United Nations (UN) is in the process of consulting on several areas being considered for improvement. Previous and live consultations can be found on the UN Statistics Division website. If you would like to discuss any of these consultations with Office for National Statistics (ONS), please contact us at sna.consultations@ons.gov.uk. Bodies outside the UK National Statistical System are also free to respond to the consultations themselves.

This release gives data for September 2021 for the first time, alongside revisions to July and August 2021.

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. 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. Our latest estimates show that the UK economy is now 0.6% 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.