UK economy flatlines with no growth in February as strikes hit productivity
The UK economy flatlined in February, with no growth in GDP, according to official figures.
Civil service strikes and low energy consumption offset growth in areas such as construction – which grew 2.4%, the Office for National Statistics (ONS) data showed.
The flatlining was unexpected. Economists polled by the Reuters news agency had forecast slight growth of 0.1% for the month.
ONS figures showed services production fell by 0.1% in the month, following growth of 0.7% in January 2023.
The largest contributor to negative growth in the services industry was education, which fell 1.7% in a month where teacher strikes took place.
Another strikes hit sector, public administration, was the second largest contributor to negative growth in the services industry.
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Construction grew thanks to repair works taking place and retail output increased as many shops had a “buoyant month”, the ONS’s director of economic statistics, Darren Morgan said.
Unseasonably mild and dry weather led to reduced production of electricity and gas, Mr Morgan added. Output in the arts, entertainment and recreation industries grew, however.
It followed growth of 0.4% in January and confirmation the UK economy avoided recession in the second half of 2022 and actually grew 0.1% in the final three months of the year.
The most recent projections from the independent economic forecaster, the Office for Budget Responsibility (OBR), said the UK will avoid recession – defined as two consecutive quarters of negative growth – in 2023, despite previous predictions.
But the economy will still shrink overall this year by an expected 0.2%, and the fiscal watchdog warned living standards are to fall by the largest amount since records began.
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On a quarterly basis, the economy grew slightly. In the three months to February, the ONS said GDP, a measure of economic growth, increased by 0.1%.
However, responding to the flatlining, Chancellor Jeremy Hunt remained upbeat about the figures.
He said: “The economic outlook is looking brighter than expected – GDP grew in the three months to February and we are set to avoid recession thanks to the steps we have taken through a massive package of cost of living support for families and radical reforms to boost the jobs market and business investment.”
Jeremy Hunt
But Labour’s shadow chancellor Rachel Reeves criticised the government’s record on economic growth.
She said: “Despite our enormous promise and potential as a country, Britain is still lagging behind on the global stage with growth on the floor.
“The reality of growth inching along is families worse off, high streets in decline and a weaker economy that leaves us vulnerable to shocks.
“These results are exactly why Labour’s mission to secure the highest sustained growth in the G7 is so important – it’s that level of ambition that we need to strengthen our economy, get our high streets thriving again and make families across every part of Britain better off.”
Conservative Party leader Kemi Badenoch has called on Sir Keir Starmer to sack Treasury minister Tulip Siddiq over allegations she lived in properties linked to allies of her aunt, Sheikh Hasina, the deposed prime minister of Bangladesh.
It comes after the current Bangladeshi leader, Muhammad Yunus, said London properties used by Ms Siddiq should be investigated.
He told the Sunday Times the properties should be handed back to his government if they were acquired through “plain robbery”.
Tory leader Ms Badenoch said: “It’s time for Keir Starmer to sack Tulip Siddiq.
“He appointed his personal friend as anti-corruption minister and she is accused herself of corruption.
“Now the government of Bangladesh is raising serious concerns about her links to the regime of Sheikh Hasina.”
Ms Siddiq insists she has “done nothing wrong”.
Her aunt was ousted from office in August following an uprising against her 20-year leadership and fled to India.
Ms Siddiq is also named with her aunt in Bangladesh court documents about meetings with the Russian government.
Tory leader Kemi Badenoch has called on Sir Keir to sack the minister
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As economic secretary to the Treasury, Ms Siddiq is responsible for policy on both the City and tackling corruption.
She referred herself to the prime minister’s ethics watchdog on Monday following the reports about the properties.
On the same day, the prime minister said: “Tulip Siddiq has acted entirely properly by referring herself to the independent adviser, as she’s now done, and that’s why we brought into being the new code.
“It’s to allow ministers to ask the adviser to establish the facts, and yes, I’ve got confidence in her, and that’s the process that will now be happening.”
Police in Aberdeen have widened the search area for two sisters who disappeared four days ago in the city.
Eliza and Henrietta Huszti, both 32, were last seen on CCTV on Market Street after leaving their home on Tuesday at around 2.12am.
The sisters – who are part of a set of triplets and originally from Hungary – crossed the Victoria Bridge to the Torry area and turned right on to a footpath next to the River Dee.
Eliza and Henrietta Huszti were last seen on CCTV in Market Street. Pic: Police Scotland/PA
They headed in the direction of Aberdeen Boat Club but officers said there is no evidence to suggest the missing women left the immediate area.
Specialist search teams, police dogs and a marine unit have been trying to trace the pair.
The sisters crossed Victoria Bridge before walking along a footpath next to the River Dee
The pair were heading in the direction of Aberdeen Boat Club on the south side of the River Dee
Further searches are being carried out towards the Port of Aberdeen’s South Harbour and Duthie Park.
Police Scotland said it is liaising with authorities in Hungary to support the relatives of the two sisters.
Chief Inspector Darren Bruce said: “Eliza and Henrietta’s family are understandably extremely worried about them and we are working tirelessly to find them.
“We are seriously concerned about them and have significant resources dedicated to the inquiry.”
The sisters, from Aberdeen city centre, are described as slim with long brown hair.
Henrietta Huszti. Pic: Police Scotland
Eliza Huszti. Pic: Police Scotland
Officers have requested businesses in and around the South Esplanade and Menzies Road area to review their CCTV footage for the early morning of Tuesday 7 January.
Police added they are keen to hear from anyone with dashcam footage from that time.
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