Healthy return to growth as GDP increases by 4.8 per cent - Chamber

The UK economy grew by 4.8 per cent between April and June, as the majority of businesses emerged from lockdown.

According to the Office for National Statistics, the expansion in gross domestic product (GDP) was fuelled by retail, restaurants and hotels.

There have also been increases in services, production and construction output over during Q2.

The economy is now 4.4 per cent below its pre-pandemic level.

Greater Birmingham Chambers of Commerce welcomed the “healthy return ” to economic growth but warned the government must ensure risks of future lockdowns are minimised.

Raj Kandola (pictured), head of policy at the Chamber, said: “As national restrictions continued to ease over the spring, it 's no surprise to see a healthy return in economic growth over the last growth.

“Fueled by a sharp rise in consumer spending, output in June was slightly stronger compared to the previous month and continues to edge towards the levels we saw prior to the outbreak of the pandemic.

“Looking ahead, we will need to take into account the impacts of the so called 'pingdemic ' before forecasting for Q3 as staff shortages, supply chain disruption and enforced closures are all likely to have an impact on output as we head towards the Autumn - factors we will closely monitor as we begin surveying for our upcoming Quarterly Business Report in a couple of weeks.

“As we set out in our latest report The Final Hurdle, the Government needs to set out a robust blueprint for minimising the risk of future lockdowns otherwise the substantial economic gains we have made over the last few months will soon be squandered. ”

Suren?Thiru, head of economics at the British Chambers of Commerce (BCC), said: "The latest data confirms a robust rebound in output in the second quarter as the UK economy unlocked and restrictions eased.

"The increase in output in the second quarter largely reflected a striking rise in household spending as the easing of restrictions helped consumers spend some of their 'unanticipated ' savings accumulated during lockdowns, boosting output from consumer facing services firms.

"Business investment remains well short of pre-pandemic levels following an underwhelming revival in the second quarter and means that it may be a weak point of the recovery, limiting UK productivity and competitiveness.

"Strong growth in the second quarter may be the high point for the UK economy with economic activity likely to moderate in the third quarter as staff shortages, supply chain disruption and consumer caution to spend limits any gains from the lifting of restrictions in July.

"Against this backdrop, policymakers must guard against complacency over the underlying strength of the recovery.

"A comprehensive rebuild strategy to turbocharge growth post Covid is needed, alongside a clear plan for dealing with any?future virus response, to give firms the confidence to start firing on all cylinders again."

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