The British economy contracted by 0.1% month-over-month in October 2024, following a similar decline in September. This result fell short of market forecasts, which had anticipated a 0.1% expansion. The contraction highlights ongoing challenges in the UK economy as various sectors struggle to maintain momentum amid global and domestic pressures.

Key Contributing Sectors

The largest contributor to the economic decline was the production sector, which saw a 0.6% drop. Manufacturing was particularly weak, with notable declines in pharmaceutical products and preparations (-2.6%), machinery and equipment (-2.8%), and chemicals (-3.7%). Additionally, the mining and quarrying sector dropped by 3.1%, while sewerage and waste management edged 0.2% lower. On the positive side, utilities grew by 1.4%, offering some support to the overall economy.

Services and Construction Show Weakness

Construction fell by 0.4% in October, contributing further to the economic contraction. The services sector showed no overall growth, as gains in information and communication (up 0.9%)—particularly telecommunications (up 2.8%)—were offset by declines in other areas. Support services dropped by 0.8%, and employment activities fell by 2.3%, reflecting weaker performance across the sector.

Mixed Economic Performance

According to Liz McKeown, ONS Director of Economic Statistics, “Oil and gas extraction, pubs and restaurants, and retail all had weak months, partially offset by growth in telecoms, logistics, and legal firms.” The mixed performance across key sectors underscores the fragility of the UK’s recovery, with some industries facing challenges while others show resilience.