Quarterly GDP growth was unchanged from the previous estimate at 0.8% and was the fifth consecutive increase. This is the longest period of continuous growth since the 2008-09 downturn and GDP now stands at 0.6% below its Q1 2008 pre-downturn peak.
While there were slight revisions to growth in a number of industry groupings for Q1 2014, their contributions to overall GDP were unchanged. Agricultural and construction industries had a marginal impact on GDP growth, while production contributed 0.1 percentage points to GDP growth in the first quarter of 2014. Within the production industries, manufacturing was the strongest performer growing by 1.4% on the quarter – its strongest quarterly growth since Q2 2010.
The services industries remained the main contributor to growth, with output increasing by 0.9% on the quarter and contributing 0.7 percentage points to quarterly GDP growth. Growth within the services industries was broad-based, with all four sub-sectors experiencing positive growth.
The Second Estimate of GDP includes initial estimates of the expenditure and income approaches to GDP.
Within the breakdown of GDP by the expenditure approach, household final consumption expenditure increased for the tenth consecutive quarter, growing by 0.8%. There were also positive contributions from gross fixed capital formation and general government final consumption expenditure, which grew by 0.6% and 0.1% respectively on the quarter. Likewise, net trade had a positive contribution to GDP growth in Q1 2014, as both imports and exports contracted on the quarter, but imports by a greater extent.
According to the income measure of GDP, compensation of employees – which includes both wages & salaries and pension contributions – grew by 0.8% in Q1 2014. Gross operating surplus grew by 1.5% in the first quarter of 2014.
At the same time, the labour market continues to perform well, demonstrating the flexibility and resilience of the UK jobs market. Labour market statistics for Q1 2014 showed the fourth consecutive quarterly rise in employment with the employment rate now standing at 72.7%, a record of 0.6 percentage points on the quarter. Since Q4 2013, the unemployment rate fell by 0.4 percentage points to 6.8%, while total weekly hours increased on the quarter to reach 975.9 million hours.
Source: Office for National Statistics
GDP: chained volume measures, seasonally adjusted, Office for National Statistics (YBEZ)
Employment level: All aged 16 and over, seasonally adjusted, Labour Force Survey, Office for National Statistics (MGRZ)
Total weekly hours (millions), seasonally adjusted, Labour Force Survey, Office for National Statistics (YBUS)
GDP data is from the "Second Estimate of GDP - Q1 2014" published on 22nd May 2014.
Labour Market data is from the "Labour Market Statistics - May 2014" published on 14th May 2014.
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