Britain officially enters largest recession on record

Britain has officially entered into the largest recession on record after figures showed the pandemic sent the economy plunging by 20.4 per cent between April and June.

Coronavirus has delivered an unprecedented economic shock.

The Office for National Statistics (ONS) confirmed the UK's nosedive into recession for the first time since the financial crisis after the record-breaking contraction in the second quarter, which follows a 2.2 per cent fall in the previous three months.

A recession is defined as two successive quarters of decline in gross domestic product (GDP).

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But monthly figures showed the economy bounced back by 8.7 per cent in June, following upwardly revised growth of 2.4 per cent in May, as lockdown restrictions eased.

The ONS said the economy is still a long way off from recovering the record falls seen in March and April after tumbling into "the largest recession on record".

Jonathan Athow, deputy national statistician at the ONS, said: "The recession brought on by the coronavirus pandemic has led to the biggest fall in quarterly GDP on record.

"The economy began to bounce back in June, with shops reopening, factories beginning to ramp up production and house-building continuing to recover.

"Despite this, GDP in June still remains a sixth below its level in February, before the virus struck.

"Overall, productivity saw its largest-ever fall in the second quarter. Hospitality was worst hit, with productivity in that industry falling by three-quarters in recent months."

Suren Thiru, head of economics at the British Chambers of Commerce, said: “The UK suffered an historic contraction in economic activity in the second quarter as the coronavirus closed large parts of the economy.

"The dominant services sector suffered particularly badly in the quarter, with consumer-focused firms hit hardest by the pandemic.

“While there was a pick-up in activity through the quarter from the historically weak April outturn, this is more likely to reflect the release of pent-up demand as the economy gradually opened, rather than an indication of a sustained revival.

“With restrictions steadily easing, the second quarter is likely to prove to be the low point for the UK economy.

"However, the prospect of a swift ‘V-shaped’ recovery remains remote as the recent gains in output may fade over the coming months as the economic damage caused by the pandemic increasingly weighs on activity, particularly as the government support measures wind down.

“Against this backdrop, bold action is needed to immediately inject confidence back into the UK economy.

"This should include supporting businesses to retain staff through a cut in employer national insurance contributions and targeted support to help businesses placed under local lockdowns.”