Despite record growth in June, UK suffers one of the largest coronavirus economic hits among rich countries

Despite the economy growing by 8.7 per cent in June, far and away the largest monthly rise on record, the 22.2 per cent fall for the first half of the year as a whole (-20.4 per cent for Q2 on its own) is by far the weakest for any six-month period on record, and is one of the largest falls among rich countries according to OECD data, the Resolution Foundation said today (Wednesday) in response to today’s ONS GDP data for June 2020.


James Smith, Research Director at the Resolution Foundation, said:

“Although today’s data tells us that the economy is recovering as lockdown restrictions ease, it still has a long way to go. And that challenge will be bigger for the UK than for most other rich countries given a larger economic hit.

“The rapid growth rates seen for some sectors, such as the hospitality sector which grew by nearly 70 per cent in June, tell us more about the extent to which the lockdown damaged economic activity than it does about prospects for a rapid recovery in the coming months and years. With many firms unable to operate as normal – and heightened uncertainty about prospects for the health crisis – the economy will take time to recover.

“The longer-term impact of the crisis on living standards will depend on the scale of the rise in unemployment and how long it lasts. So the Government’s priority should be providing support to those parts of the economy hardest hit by the crisis, supporting jobs while also helping those unlucky enough to become unemployed.”