The UK economy - Statistics & Facts

The gross domestic product of the British economy was 2.23 trillion British pounds in 2022 and was the fifth-largest global economy, behind the United States, China, Japan, and Germany. In 2020, the UK economy shrank by a record eleven percent due to the economic fallout of the Coronavirus pandemic. In some ways, the UK economy has successfully recovered from the sudden shock of the pandemic. An annual GDP growth rate of 7.6 percent was recorded in 2021, and the unemployment rate has quickly recovered to its pre-pandemic levels of less than four percent. The inflation rate, by contrast, increased rapidly towards the end of 2021 and reached a 41-year high of 11.1 percent in October 2022, highlighting that despite the initial economic recovery, the UK is set to endure its worst cost of living crisis since the 1970s, driven by rising prices, tax increases, and geopolitical instability.

UK households under pressure in 2023

Although many of the factors driving the current crisis were noticeable towards the end of 2021, the situation intensified the following Spring due to a series of price increases that have put immense pressure on British households. In March 2022, approximately 83 percent of UK households reported that their cost of living had increased in the last month, compared with 62 percent in October 2021. On April 1, 2022, the average annual energy bill for a typical home in the UK rose significantly due to the energy cap (which limits what suppliers can charge per unit of energy) increasing on this date, with a further rise occuring in October 2022. The cumulative impact of all these factors on real household disposable income was a 3.7 percent decline, the biggest fall in living standards since at least 1956. It is unclear how long this crisis will last, with the annual inflation rate for 2023 expected to remain high, at 6.1 percent before falling to 0.9 percent in 2024. The economy as a whole is expected to shrink by 0.2 percent, while unemployment is expected to remain reasonably low, at 4.1 percent.

Coronavirus devastates UK economy in 2020

Although the UK government moved swiftly to mitigate the economic devastation of the COVID-19 pandemic in early 2020 by furloughing workers and protecting the incomes of the self-employed, its handling of the public health crisis was much less assured, and the country suffered a very high number of deaths in the initial wave as a result. In April 2020, the GDP of the UK fell by 18.9 percent, the biggest monthly fall in GDP ever recorded. Unemployment claims, which numbered 1.23 million before the pandemic, increased to 2.62 million by May. As Summer arrived, there were estimated to be just 343 thousand job vacancies, compared with 796 thousand before lockdown measures started. With cases falling, some parts of the UK economy began to open up, with the government providing aid to the ailing restaurant industry through the 'Eat out to Help Out' scheme. The end of summer coincided with the arrival of the second wave of the pandemic just as the government's trade negotiations with the European Union began to enter troubled waters. Although an agreement was eventually reached and ratified just before the end of the transition period, the arrangement has left the UK economically isolated from the rest of the continent.
This text provides general information. Statista assumes no liability for the information given being complete or correct. Due to varying update cycles, statistics can display more up-to-date data than referenced in the text.
Published by D. Clark, Nov 24, 2023

Key insights

GDP of the UK
2.2 tr GBP
Unemployment rate
4.2%
Inflation rate
4.6%
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Editor’s Picks Current statistics on this topic

Average year-on-year growth of weekly earnings (3 month average) in the United Kingdom from March 2001 to September 2023

Wages & Salaries

Average weekly earning growth in the UK 2001-2023

Budgeted public sector expenditure on services in the United Kingdom in 2023/24, by function (in billion GBP)

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Public sector spending in the United Kingdom 2023/24

Number of people employed in the United Kingdom from March 1971 to July 2023 (in 1,000s)

Employment

Number of people employed in the UK 1971-2021

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