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Gloucestershire Business News

GDP latest: small change spells a July dip

The UK's monthly real gross domestic product (GDP) looks to have taken a 0.5% dip thanks to all three main sectors faltering in June.

The news came against the more positive backdrop of a 0.2% GDP rise in the three months to July 2023, with growth in all the three key sectors of production, retail and construction.

Services output was down 0.5% in July 2023 (following growth of 0.2% in June) and was, said the Office for National Statistics (ONS), the main contributor to July's negative result.

Darren Morgan, ONS director of economic statistics, said: "In July, industrial action by healthcare workers and teachers negatively impacted services and it was a weaker month for construction and retail due to the poor weather. Manufacturing also fell back following its rebound from the effect of May's extra Bank Holiday."

He added: "A busy schedule of sporting events and increased theme park visits provided a slight boost."

In consumer services, output signalled no growth following growth of 0.5% in the previous month. Meanwhile production output fell by 0.7% after growth of 1.8% in June 2023. The construction sector fell by 0.5%, after growth of 1.6% across June 2023.

In detail, the ONS said:

● The main contributor to the fall in monthly services output was the human health and social work activities sub-sector, which fell by 2.1% in July 2023. This was attributed entirely to a 3.4% fall in the human health activities industry. Industrial action was held in July by NHS senior doctors (two days) and radiographers (two days) for the first time while industrial action by junior doctors increased (five days in July, compared with three in June). NHS England reported that 65,557 appointments and procedures were cancelled because of the senior doctors strike and 101,977 acute inpatient and outpatient appointments were cancelled because of the industrial action by junior doctors.

● The next largest contributor to the fall in services output in July 2023 was the 2.1% fall in information and communication, following on from three consecutive monthly growths in this sub-sector. Computer programming, consultancy and related activities was the largest contributing industry, falling by 3.4% in July after three consecutive monthly growths in April, May, and June 2023.

● Administrative and support service activities also fell in July 2023, by 1.4%. The largest industry within this sub-sector was employment activities, which fell by 2.3% in July after a growth of 2.1% in June. This industry has had a decrease in monthly output in 9 of the last 12 months. Education also fell in July 2023, by 1.1%, where the sector saw two days of industrial action in England at the start of the month. Please note that education attendance is considered to be constant over the school year, so summer holidays and school leavers did not reduce the estimate of education output in July 2023.

The main offsetting positive contribution, said the ONS, was from the arts, entertainment and recreation sub-sector, which grew by 6.6% in July 2023; this was its largest growth since May 2021. Sports activities and amusement and recreation activities grew by 12.4% and creative, arts and entertainment grew by 4.9%.

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