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The UK economy increased by a “better-than-expected” 7.5% in 2021 to record the “fastest” incline since the Second World War, following the 9.4% contraction in 2020.
Data released by the Office for National Statistics (ONS), shows that the UK is on track to be the “fastest growing economy” in the G7 last year, after experiencing one of the “worst” annual declines in 2020.
It revealed the UK gross domestic product (GDP) is estimated to have increased by 1.0% in quarter four (Oct to Dec) 2021, following a downwardly revised 1.0% increase in quarter 3 (July to Sept).
In output terms, the largest contributors to this quarterly increase were from human health and social work activities driven by increased GP visits at the start of the quarter, and a large increase in coronavirus testing and tracing activities and the extension of the vaccination programme.
Despite the rapid growth, measured on a quarterly basis, the office said UK’s gross domestic product in the three months to December remained 0.4% below the level recorded in the fourth quarter in 2019, before the spread of Covid-19.
The monthly data showed that GDP fell by 0.2% in December. City economists had forecast a 0.6% decline.
Suren Thiru, head of economics at the British Chambers of Commerce, said: “Although 2021 was a record year for the UK economy, this more reflects data distortions caused by the comparison with the historic collapse in activity in 2020, than the reality on the ground.
“The UK economy is facing a materially weaker 2022 as the crippling burden of rising inflation, soaring energy bills and higher taxes on consumers and businesses dampens activity, despite a temporary boost from the lifting of Plan B restrictions.”
