Record-busting collapse in GDP as output in April falls by a fifth 12 June 2020 April saw the sharpest monthly contraction on record, with GDP falling by 20.4 per cent compared with March, the Resolution Foundation said in response to latest figures released today (Friday) by the Office for National Statistics. This monthly contraction is more than 9 times greater than any pre-pandemic monthly fall since these records began in 1997 (beating the 2.2 per cent fall in June 2002). In the three months to April output fell by 10.4 per cent compared to the previous three months, translating into the UK producing around £60 billion less than in it did in the three months to January this year. This growth rate is the weakest on record since 1955, and considerably weaker than at the height of the financial crisis when the biggest quarterly fall was around 2 per cent. The Foundation notes that the second quarter of this year is on course for a contraction of around 25 per cent, taking the country into the deepest recession for over 300 years. James Smith, Research Director at the Resolution Foundation, said: “Today’s release lays bare the devastating impact that the coronavirus crisis is having on the economy, with a fall in output more than nine times bigger than the previous record. “But while this contraction is unprecedented, it is not unexpected. Shutting down large parts of our economy inevitably means big falls in economic activity. “This is why the first priority for policy makers was to protect people and firms from that impact with significant policy announcements. But looking ahead, policy can shape how much lasting damage is done and this underscores the need for different, but equally bold, further economic policy measures in the months ahead.”
