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UK economy grows 2.3% in April as Covid restrictions ease and pubs and shops reopen

·3-min read
Shoppers returning to high streets helped to boost economy in April (AFP/Getty)
Shoppers returning to high streets helped to boost economy in April (AFP/Getty)

The UK economy grew in April at the fastest pace since July 2020 but it still remains below pre-pandemic levels, according to official figures.

Gross domestic product (GDP) – a measure of the size of the economy – rose 2.3 per cent, partly thanks to a 3.4 per cent bounce in the services sector as pubs and non-essential retailers welcomed customers back.

Retail sales grew sharply in April 2021 with a monthly increase of 9.2 per cent. Clothing sales jumped 69.4 per cent as easing of lockdown measures allowed for more socialising.

While bars, shops and restaurants saw spending increase, construction industry output shrank 2 per cent, the Office for National Statistics reported.

Caravan parks and holiday lets to grow 68.6 per cent as households also took advantage of the ability to travel across the country again. Hairdressers and other personal services grew 63.5 per cent.

The services sector – which makes up the around four-fifths of the economy – remains 4.1 per cent below its pre-pandemic level while the economy as a whole remains 3.7 per cent smaller.

Experts forecast that the data would show the recovery continued into May and June but pointed to challenges for the UK economy beyond the pandemic.

“Falls in construction and production, which were less affected by the 2021 lockdown, remind us that our focus should now be on the prospects for the economy in the second half of the year, after temporary reopening effects have ceased to provide strong monthly increases,” said Rory Macqueen, principal economist at the National Institute for Economic and Social Research.

Chancellor Rishi Sunak said the figures were a “promising sign” that the economy is beginning to recover.

“With more than a million people coming off furlough across March and April and the number of employees in work rising, it is clear that our Plan for Jobs is working.”

Boris Johnson is expected to make an announcement on the next stage of reopening on Monday. Businesses that are still operating below capacity, such as wedding venues, and those that cannot open at all, like nightclubs, are urging the government not to postpone a suggested 21 June date for ending all restrictions.

Vaccines minister Nadhim Zahawi stressed the importance of being “really careful” when asked about the possibility of a delay to the June 21 lifting of coronavirus restrictions in England.

“There has been some really hard won battles against this virus and we don’t want to squander those hard fought gains that we have made through the vaccination programme,” he told Times Radio Breakfast.

Travel restrictions have also proved controversial. Data released on Friday shows that Heathrow’s passenger numbers are languishing 90 per cent below pre-pandemic levels.

Heathrow said that just 675,000 people travelled through the west London airport last month, compared with 6,769,000 in May 2019.

The latest official figures on trade show the UK imported more goods from outside the EU in April than at any point since 1997, but exports from the country fell.

Total exports, excluding precious metals, fell by 0.6 per cent in April following two months of growth.

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