UK Economy Officially Slips Into Recession After 11 Years

The United Kingdom economy experienced its biggest fall on record between April and June as the economy shrank 20.4% in comparison to the first three months of the year.

The coronavirus lockdown measures dragged the country officially into recession for the first time in 11 years.

Household spending contracted as shops were shut, while factory and construction output also declined sharply. The services sector, which constitutes four-fifths of the economy, witnessed the biggest quarterly decline on record.

Reacting to the data, UK Chancellor Rishi Sunak admitted that the government was "grappling with something that is unprecedented" and that it was "a very difficult and uncertain time".

"The UK economy had performed worse than its EU counterparts because it was focused on services, hospitality and consumer spending," Sunak said. "Those kinds of activities comprise a much larger share of our economy than they do for most of our European cousins," he added.

However, shadow chancellor Anneliese Dodds blamed Prime Minister Boris Johnson for the economic downfall, saying: "A downturn was inevitable after lockdown - but Johnson's jobs crisis wasn't."

The Office for National Statistics also said that the economy bounced back in June as government restrictions on movement began to ease. The economy grew by 8.7% in June, after growth of 1.8% in May.

"Despite this, gross domestic product (GDP) in June still remains a sixth below its level in February, before the virus struck," Jonathan Athow, deputy national statistician for economic statistics said.

The slump in the UK economy is one of the most significant among advanced economies. The economy is more than a fifth smaller than what it was at the end of last year.

The decline is not as bad as the 22.7% decline in Spain, but nearly twice the size of decline in Germany and the US.

Also Read: US: Trump Administration Permits H-1B Visa Holders To Return For Same Jobs They Did Before Ban