GDP sees first drop in 2022

Services fell by 0.2% during this month and was the main contributor to March’s fall in GDP. This output is however 1.5% above its pre-Covid pandemic levels in February 2020, with eight of the 14 service sectors being above their pre-Covid levels. 

Wholesale retail trade fell by 2.8%, with the main driver of this fall being wholesale and retail trade, as well as repair of motor vehicles and motorcycles - which fell by 15.1%. This is the fourth consecutive month of negative growth in this industry. 

The largest positive contributor to services, meanwhile, was human health and social work activities - up 1.5%. Of this, human health activities - up 2.1% - was the main driver of this growth, largely reflected in the rise in GP appointments, and accident and emergency care. 

Overall, production output dropped by 0.2%, driven by falls in manufacturing and electricity, gas, steam and air conditioning supply. This follows a 0.3% decline in February. 

Manufacturing decreased by 0.2%, with the manufacture of basic pharmaceutical products and pharmaceutical preparations as the largest contributor to the negative growth - down 5.4%. Other noteworthy falls included the 4.1% seen in the manufacture of textiles, wearing apparel and leather products, and 3.5% in chemicals and chemical products. 

Electricity, gas, steam and air conditioning supply dropped by two percent, with the manufacture of gas, distribution of gaseous fuel through mains, as well as steam and aircon supply decreasing by 4.3%.

Water supply and sewerage remained broadly flat on the month while there was a five percent growth in waste collection, treatment and disposal activities. 

The ONS also published its first quarterly estimate of GDP for 2022, with it estimated to have increased by 0.8% when compared to the first quarter of 2021. The level of quarterly GDP during this period is now 0.7% above its pre-Covid level. 

In output terms, services increased by 0.4% with the largest contributors being from the information and communication, accommodation and food, and transportation and storage industries. 

There was also a 0.6% increase in household consumption partially offset by large movements in international trade flows. There is, however, some additional uncertainty on the EU trade flows because of changes in how some of this data is collated.