UK economy returns to growth as car manufacturing rebounds
Gross domestic product increased by 0.3% in November, according to the Office for National Statistics.
The UK economy returned to growth in November after a boost from Jaguar Land Rover (JLR) factories restarting production following a cyber attack, according to official figures.
The Office for National Statistics said UK gross domestic product (GDP) increased by 0.3% for the month, following a 0.1% decline in October.
The increase was sharper than expected, with economists having predicted a 0.2% rise for the month.
Official figures also showed the UK economy grew in September, with a 0.1% rise, after previous estimates of a 0.1% fall were revised on the back of more data, particularly from the pharmaceutical sector.
November’s economic growth was supported by a 25.5% jump in the motor manufacturing industry as it continued to bounce back following a sharp fall in activity in September after JLR’s factory shutdown.
The UK’s largest car manufacturer saw production return to more normal levels in November after it had stopped operations across manufacturing and sales sites in September due to the impact of a major cyber attack.
ONS director of economic statistics Liz McKeown said: “Data for the latest month show that this industry has now largely recovered.
“Construction contracted again, registering its largest three-monthly fall in nearly three years.”
The monthly figures showed that construction slipped by 1.3% in November, continuing a recent downward trend.
The production sector however grew by 1.1% for the month, driven by motor manufacturing, as well as a 3.8% jump for pharmaceutical products.
Elsewhere, the services sector grew by 0.3%, turning around a 0.3% decline in October.
This was partly linked to growth in professional and scientific services, which reported a 1.7% increase.
Overall growth in November came despite many firms reporting caution in the run-up to the autumn Budget near the end of the month.
The stronger-than-expected data will provide a boost to the Chancellor Rachel Reeves after tepid growth in recent months, with the Labour Government hoping that economic growth can help boost the state finances.
Ben Jones, lead economist at the CBI, said: “This latest data is better than expected and suggests the economy was more resilient towards the end of last year than earlier figures implied – with revisions pointing to less of a slowdown than previously feared.
“While growth is likely to remain moderate, the economy should still expand at a steady pace through 2026 as inflation eases and real incomes rise modestly.
“However, business investment is likely to remain fairly subdued amid soft demand conditions, high labour and energy costs and supply-side bottlenecks.”
Suren Thiru, ICAEW economics director, said: “This return to growth probably won’t trigger a sustained economic revival with softer consumer spending amid an intensifying tax burden and higher unemployment likely to mean noticeably weaker growth for 2026, despite a boost from lower inflation.
“These figures make a February interest rate cut less likely by giving those rate-setters still concerned over inflation with sufficient comfort over economic conditions to delay voting to ease policy again.”
