Official estimates indicate that Britain's economic recovery had nearly stalled before the launch of the new Omicron form of Covid-19.
According to the Office for National Statistics, output increased by only 0.1 percent in October — the first month following the conclusion of the government's furlough scheme.
The modest monthly increase in the gross domestic product was less than forecast, with experts polled expecting growth of 0.4 percent. The GDP expanded by 0.6 percent in September.
A breakdown of the data revealed a significant decline in the number of people visiting restaurants, pubs, and bars even before stricter limitations were implemented this month. At the end of October, gross domestic output was still 0.5 percent below its pre-crisis peak in February 2020.
Only services expanded in October, with increased spending in stores and an increase in face-to-face GP consultations leading to a 0.4 percent gain.
However, production – manufacturing, energy, and North Sea oil and gas – fell by 0.6 percent, while a lack of supplies caused a 1.8 percent decline in building output, the worst loss since the outbreak began in April 2020.
"While GDP growth slowed in October, the UK health sector continued to grow strongly, while secondhand car sales and employment agencies also boosted the economy," said Grant Fitzner, chief economist at the ONS. For the first time in 20 months, the dominating services sector returned to pre-pandemic levels.
"These improvements were countered by a decline in restaurant sales following a robust summer, as well as decreased oil extraction and gas consumption. Construction also had its sharpest decline since April last year, with considerable declines in housebuilding and infrastructure activities, owing in part to raw material shortages."
The economy expanded by 0.9 percent in the three months to October, a significant drop from the spring and summer growth rates.
The chancellor, Rishi Sunak, stated: "We have always acknowledged that there may be bumps along the road to recovery, but the early actions we took, our ongoing £400 billion economic stimulus package, and our vaccine program put us in a strong position to keep our economy on track."
"We have continued to recover more quickly than anticipated, with more employees on payrolls than ever before and low levels of redundancy."
Alpesh Paleja, the CBI's principal economist, stated: "Growth disappointed in October, reinforcing concerns about the UK's economic recovery's resilience to the Omicron variant and the impact of additional restrictions."
