The UK economy unexpectedly grew by 0.1% in the last quarter of 2024 on the back of an unexpectedly strong December. But yet another fall in GDP per capita underlines our ongoing living standards squeeze. A thread on the key takeaways from today’s data.🧵 - ThreadSky

simonpittaway.bsky.social • 21 days ago

The UK economy unexpectedly grew by 0.1% in the last quarter of 2024 on the back of an unexpectedly strong December. But yet another fall in GDP per capita underlines our ongoing living standards squeeze. A thread on the key takeaways from today’s data.🧵

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simonpittaway.bsky.social•21 days ago

Q4 growth was rescued by a resurgence in services in December (professional services in particular). The services reading for December was quite a bit stronger than suggested by survey data and should be taken with more than the usual dose of salt at this stage in the data cycle.

simonpittaway.bsky.social•21 days ago

But, looking at 2024 as a whole, growth slowed dramatically over the course of the year. The UK economy grew 1.3% in the first half of 2024 and slowed to just 0.1% in the second half – the sharpest slowdown outside of the pandemic since 2010.

simonpittaway.bsky.social•21 days ago

In contrast to modest headline growth, GDP per capita shrank once again.

Worryingly, we’ve now only seen four quarters of per capita growth in the past three years of data (going back to the start of 2022).

simonpittaway.bsky.social•21 days ago

Our shocking record of per capita growth means that we’re now halfway through the 2020s and GDP per capita is lower than when the decade started. By my calculations, that hasn’t happened in any decade since the 1920s!

simonpittaway.bsky.social•21 days ago

The UK isn’t alone in its recent struggles – Canada and Germany have seen GDP per capita fall by slightly more over the past five years. But if the UK had managed even the average recovery of other G7 economies, annual GDP per capita would be £450 higher today.

simonpittaway.bsky.social•21 days ago

Digging into the UK data, what drove the growth slowdown in 2024?

Most of the slowdown came from services, which contributed 1.3ppts to total growth in H1 and just 0.1ppts in H2. But note that the *level* of activity remains weakest in the production sector.

petemarchetto.bsky.social•21 days ago

When the only way we can come up with a graph for growth is to run it from -0.4% to 1%, then all we need to say is 'flatlining' and not bother acting as if the bars on the chart mean a blessed thing.

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