The UK economy shrank by 1.5% during the first three months of the year due to the impact of the national lockdown.
According to the latest figures by the ONS however, the contraction shows a marked improvement on the first lockdown last year when gross domestic product (GDP) contracted by 19.5% over the April-June period.
The figures show that GDP shrank by 2.5% in January but increased by 0.7%, in February, and then improved with its strongest performance of the year in March, increasing by 2.1%.
March’s GDP is 5.9% below the levels seen in February 2020, and 1.1% below the initial recovery peak in October 2020.
In March, the service sector grew by 1.9% in March 2021, with schools re-opening across England and Wales and retail trade sales continuing to show strength.
Output in the production sector grew by 1.8%, as manufacturing grew for a second consecutive month, at 2.1%.
In addition, the construction sector grew by 5.8% in March 2021, driven by growth in both new work and repair and maintenance. The ONS said the growth in construction and manufacturing reflects businesses “continuing to adapt, including development of COVID-19 secure environments to operate in”.
Chancellor Rishi Sunak said: “Despite a difficult start to this year, economic growth in March is a promising sign of things to come.
“Even with this positive news, we know that many businesses and people still need our help, and that’s why I want to reassure everyone today that our plan for jobs will continue to create, support and protect jobs in the coming months.”