London - The COVID-19 pandemic hit Britain’s economy the hardest, a larger decline than any other major economy, updated official figures showed on Monday. The country’s economy recorded its biggest fall in output in more than 300 years, the worst since 1709.

The Office for National Statistics said it had revised down annual volume GDP growth in 2020 by 1.7 percentage points, meaning that it fell by 11 per cent, the largest in more than 300 years and the worst recorded among G7 countries.

Craig McLaren, ONS head of national accounts, said “the updated estimates for 2020” showed that “overall, the economy fared worse than we initially estimated”.

The revision means that the economy could now be smaller than initially estimated, and could suggest that the UK faced a cost of living crisis before it managed to recover fully from the hit of the pandemic.

Because of the downward revision for 2020, “growth in 2021 and 2022 will be starting from a lower point than we previously estimated”, added McLaren.

Elsewhere in Europe, a recession is now almost certain, inflation is nearing double digits and a winter with looming energy shortages is fast approaching.

Though bleak, this outlook is still likely to get worse before any significant improvement well into 2023.

Households and businesses are both suffering as the fallout of the war - high food and energy prices - is now exacerbated by a devastating drought and low river levels that constrain transport.

"We see continued acute shortages of labour, historically low unemployment and a high number of vacancies," European Central Bank board member Isabel Schnabel told Reuters earlier. "This probably implies that even if we enter a downturn, firms may be quite reluctant to shed workers on a broad scale."
-Reuters/FT