Britain’s economy returned to growth in November, expanding 0.1% after October’s 0.1% decline. The modest rebound, driven by the resilient service sector, offers a glimmer of hope amid persistent economic challenges.
Service Sector Powers November Growth
The UK’s service industry, which accounts for around 80% of the economy, grew 0.1% in November. This key sector, encompassing businesses from restaurants to law firms, has proven to be the backbone of Britain’s economy during turbulent times.
The service sector’s resilience has been vital in keeping the UK economy afloat. While growth remains modest, it’s encouraging to see this pillar of our economy continuing to expand.
– Rachel Reeves, Chancellor of the Exchequer
Hospitality and Travel Boost Services
Within the service sector, hospitality and travel-related businesses saw notable gains. As consumer confidence gradually improves, more Britons are dining out and booking holidays, providing a much-needed lift to these industries.
- Accommodation and food services grew 2.3% in November
- Travel agency and tour operator activities rose 3.7%
Manufacturing Woes Persist
While services expanded, the manufacturing sector continued to struggle. Factory output fell 0.4% in November, marking the fourth consecutive month of decline. High energy costs and weakening global demand have weighed heavily on British manufacturers.
| Month | Manufacturing Growth |
| August 2024 | -0.2% |
| September 2024 | -0.1% |
| October 2024 | -0.3% |
| November 2024 | -0.4% |
Construction Sector Builds Momentum
In a bright spot, the construction industry grew 0.4% in November, continuing its upward trajectory. Robust demand for new homes and commercial projects has underpinned the sector’s expansion.
Construction Sector Highlights:
- New housing construction rose 1.2%
- Commercial building projects grew 0.6%
- Infrastructure work increased 0.3%
Economic Outlook Remains Challenging
Despite November’s growth, the UK economy faces significant headwinds. Soaring inflation, rising interest rates, and geopolitical uncertainties continue to cloud the horizon. Forecasters warn that a recession may still be looming.
The road ahead remains challenging for the UK economy. While pockets of resilience exist, we must stay vigilant and prepared for potential turbulence in the coming months.
– Simon Rubinsohn, Chief Economist at RICS
Chancellor Reeves Focuses on Growth
Amid the mixed economic picture, Chancellor Rachel Reeves has pledged to prioritize growth. Her government’s “Plan for Change” aims to boost investment, drive reforms, and spur economic expansion.
After 14 years of stagnation, kickstarting growth is my number one mission. I will fight every day to expand our economy and put more money into working people’s pockets.
– Rachel Reeves, Chancellor of the Exchequer
As Britain navigates the uncertain economic landscape, all eyes will be on the service sector to maintain its growth trajectory. Policymakers hope that the industry’s resilience, coupled with targeted government support, will be enough to steer the UK towards a sustainable recovery.
