UK GDP Statistics: Economic Growth Data

What GDP measures and why it matters

Gross Domestic Product (GDP) measures the total value of goods and services produced in the UK economy over a given period, providing the single most comprehensive indicator of economic size and growth. The ONS produces GDP estimates from three approaches -- output, expenditure, and income -- which should in principle give the same result. Monthly GDP estimates use the output approach, while the quarterly first estimate incorporates all three. GDP expressed in real terms, adjusted for price changes, allows comparison of economic activity across time without the distorting effect of inflation.

In cash terms, UK GDP was 3,037 billion pounds in 2025, making the UK one of the largest economies in the world by nominal output. As a basis for policy, GDP per capita is often more informative, reflecting the average standard of living. UK GDP per capita growth has been constrained by a combination of subdued productivity growth and population changes.

Q1 2026: stronger growth on the quarter

UK real GDP increased by 0.6% in Q1 2026 (January to March), following revised growth of 0.2% in Q4 2025. This represents an acceleration from the sluggish growth of the second half of 2025 and was broadly in line with the stronger monthly GDP figures published for January and February 2026. On an annual basis, GDP expanded by 1.1% in Q1 2026 compared with Q1 2025, slightly above the OBR forecast at the time of 1.1%.

All three main sectors contributed positively to Q1 2026 growth. The services sector, which accounts for approximately 80% of UK output, grew by 0.8%, led by wholesale and retail trade, which grew by 2.0%, with wholesale trade up 3.1% and retail trade up 1.6%. Production output grew by 0.2%, supported by a 0.8% rise in manufacturing and a 0.6% increase in electricity, gas and air conditioning supply. Construction grew by 0.4%, ending five consecutive quarterly falls, though new housing work continued to decline.

April 2026: first monthly contraction since August 2025

Monthly GDP contracted by 0.1% in April 2026, in line with market expectations and following growth of 0.3% in March. This marked the first monthly fall in output since August 2025. The ONS commentary attributed the April contraction primarily to the early effects of Middle East conflict disruption rippling through the economy. Services output declined 0.2%, with significant falls in administrative and support service activities (-2.2%) and arts, entertainment and recreation (-4.3%), offset by growth in information and communication (+1.1%). Production output was flat and construction grew by 0.1%.

The April contraction is consistent with the broader impact of elevated energy prices and supply chain uncertainty on business activity and consumer spending. Retail footfall was broadly unchanged from March but below April 2025 levels. Automotive fuel prices in the week ending 26 April 2026 were 12% higher than in the week ending 29 March 2026, with estimated quantity demanded falling 10%, indicating significant consumer adjustment to higher fuel costs.

GDP performance in annual context

Annual GDP growth was 1.4% in 2025, revised from an initial estimate. This was stronger than the 1.0% growth recorded in 2024 (itself revised down from 1.1%). The recovery from the near-stagnation of the 2023-2024 period reflects a combination of easing inflation enabling real household income recovery, government spending growth, and resilient services output. Q1 2026 is now estimated to be 6.0% above its pre-pandemic level of Q4 2019, indicating that the UK economy has recovered in aggregate terms even though the composition of output and the distribution of gains have shifted significantly.

Expenditure breakdown

On the expenditure side, Q1 2026 GDP growth of 0.6% was driven by increases in gross capital formation, household consumption, and government consumption. Real household final consumption grew by 0.6% in Q1 2026, 0.9% higher than a year earlier, led by increases in miscellaneous goods, food and drink, recreation and culture, and transport. Government consumption grew by 0.4% in the quarter, with increases in education, health and social care. Gross fixed capital formation fell by 0.6%, with business investment declining 2.5%, reflecting corporate caution in conditions of elevated uncertainty.

Net trade was broadly neutral in Q1 2026. Exports were affected by a processing error in trade in goods data supplied by HMRC for the period July to December 2025, which has been corrected in the Q1 2026 release. The corrected data do not affect GDP estimates for Q3 or Q4 2025.

Sectoral analysis

Services remain the dominant driver of UK GDP, accounting for approximately 80% of output and growing by 0.8% in Q1 2026. Within services, information and communication was a strong contributor, alongside wholesale and retail trade. Professional, scientific and technical activities fell in April 2026 alongside other business services, reflecting the early impact of external uncertainty on corporate activity.

Manufacturing output increased by 1.2% in March 2026, contributing to a positive production picture for Q1 2026. Construction grew in Q1 following a sustained period of weakness, but the performance was uneven, with repair and maintenance surging by 3.4% while new work fell by 1.9%. Private new housing fell by 2.6%, consistent with subdued conditions in the residential development market linked to planning constraints and the impact of higher mortgage rates on housing demand.

Forecasts for 2026 and 2027

The Office for Budget Responsibility (OBR) forecast annual GDP growth of 1.1% in 2026 in its March 2026 Economic and Fiscal Outlook. The Treasury's June 2026 survey of independent forecasters showed an average forecast of 0.9% for 2026 and 1.0% for 2027, somewhat below the OBR. The downward revision in independent forecasts reflects the impact of Middle East conflict on energy prices and supply chain conditions that were not fully incorporated into the March 2026 OBR projections.

The UK's exposure as a net energy importer to global oil and gas price shocks is a key risk factor for the 2026 growth outlook. Higher energy prices reduce household real incomes, increase input costs for businesses, and dampen investment. The BoE's April 2026 projections factored in the energy price spike but noted that the outlook depended heavily on the trajectory of oil prices in the second half of 2026.

What is the current UK GDP growth rate?

UK real GDP grew by 0.6% in Q1 2026 (January to March) compared with Q4 2025. Monthly GDP contracted by 0.1% in April 2026, the first monthly fall since August 2025. Annual GDP growth in 2025 was 1.4%.

What is UK GDP in pounds?

UK GDP in cash (nominal) terms was 3,037 billion pounds in 2025. In real terms (adjusted for prices), Q1 2026 GDP is estimated to be 6.0% above its pre-pandemic Q4 2019 level.

What is the OBR forecast for UK GDP growth in 2026?

The OBR forecast annual GDP growth of 1.1% in 2026 in its March 2026 Economic and Fiscal Outlook. The Treasury's June 2026 survey of independent forecasters showed an average forecast of 0.9% for 2026, reflecting the impact of Middle East conflict on the economic outlook.

Which sectors drove UK GDP growth in Q1 2026?

All three main sectors grew in Q1 2026. Services grew 0.8% (led by wholesale and retail trade), production grew 0.2% (manufacturing and energy), and construction grew 0.4% after five consecutive quarterly falls.

Why did UK GDP fall in April 2026?

Monthly GDP contracted 0.1% in April 2026, driven by declines in administrative services, arts and entertainment, and broader business activity. ONS attributed the fall to the early transmission of Middle East conflict impacts on the UK economy through energy prices and supply chain uncertainty.

UK productivity context

GDP per hour worked, the standard measure of labour productivity, is a critical determinant of sustainable economic growth and living standards. UK productivity growth has been weak since the 2008-09 financial crisis, averaging around 0.3-0.5% per year compared with the pre-crisis average of approximately 2% per year. This productivity slowdown, often termed the UK productivity puzzle, has multiple contributing factors including reduced business investment, a shift in the composition of output toward lower-productivity services, and the legacy effects of the financial crisis on capital allocation. In Q1 2026, GDP growth of 0.6% and employment broadly stable implies positive productivity growth in the quarter, a positive signal but insufficient to address the structural productivity gap accumulated since 2008.

Business investment fell by 2.5% in Q1 2026, which is a concern for the productivity outlook. Business investment in new machinery, technology, and structures is a primary driver of productivity improvement over time. The combination of elevated interest rates reducing the incentive to borrow for investment, economic uncertainty linked to geopolitical factors, and ongoing questions about trade relationships has weighed on business investment through 2025 and into 2026. The government's industrial strategy, launched in 2025, aims to address structural investment weakness through targeted support for key sectors including advanced manufacturing, life sciences, clean energy, and digital technologies.

Government finances and public sector net borrowing

UK GDP provides the denominator for measuring fiscal sustainability. The UK public sector net debt as a percentage of GDP is a key metric watched by financial markets, the Office for Budget Responsibility, and international institutions. With GDP at 3,037 billion pounds in 2025, even modest changes in the deficit or debt levels translate into significant absolute sums. The OBR's March 2026 Economic and Fiscal Outlook projected borrowing and debt trajectories consistent with the government's fiscal rules, including a commitment to have debt as a share of GDP falling by the end of the forecast period. The GDP growth outturn of 1.4% for 2025 and the Q1 2026 quarterly figure of 0.6% will feed into OBR and HM Treasury forecasts, with higher-than-projected growth reducing the deficit relative to GDP even without policy changes.

UK trade and the current account

The UK runs a persistent current account deficit, meaning imports of goods, services, income and transfers exceed exports. This deficit is financed by capital inflows from overseas investors and has been a structural feature of the UK economy for decades. In Q1 2026, the trade deficit excluding non-monetary gold and other precious metals was estimated at 0.9% of nominal GDP. ONS identified and corrected a processing error in trade in goods export data supplied by HMRC for the period July to December 2025, which affected the recording of goods exports but not GDP estimates. The correction illustrates the complexity of measuring trade flows in real time, particularly for a period of elevated supply chain disruption.

Services exports remain a relative strength for the UK, with financial services, insurance, professional services, and higher education generating significant net export revenues. However, goods trade deficits, driven by the UK's heavy dependence on imported manufactured goods, food, and energy, have widened during periods of commodity price inflation. The import price index rising by 10.1% in the year to May 2026 according to ONS producer price data reflects the transmission of global commodity and transport cost increases into UK import prices, exerting downward pressure on the trade balance and providing an inflationary impulse through import costs.

How GDP compares with other measures of welfare

GDP is a measure of economic output, not welfare or wellbeing. GDP counts all production regardless of its social value and does not capture distribution, sustainability, or non-market activity such as unpaid care work. The ONS Measuring National Wellbeing programme publishes a broader set of indicators that supplements GDP with measures of personal wellbeing, relationships, health, education, environment, and governance. These indicators show that GDP growth does not always translate into improved wellbeing, particularly when growth is unequally distributed or occurs in sectors that generate negative externalities. The ONS is also developing natural capital accounts and green GDP measures that adjust for the depletion of environmental assets, in line with international statistical frameworks being developed by the United Nations and OECD.