UK economy shrinks by 20.4%, new GDP figures show

The UK economy shrank a record 20.4% in April.

Figures published this morning showed the toll as businesses and workers reeled under the impact of the coronavirus lockdown.

Today’s figure followed a 5.8% fall in March.

It is likely to lead to louder calls for the Government to ease the lockdown on businesses against the prospect of rising unemployment.

Reports this week claimed that the UK unemployment rate could reach as high as almost 15% by this time next year.

Figures from the OECD also released this week predicted that the UK could see one of the developed world’s deepest recessions, with output sliding by more than 11%.

The pound was down 0.2% at $1.2575 following release of today’s figures.

The UK’s services industry experience a 19% drop in April, while manufacturing fell by 24.3% and construction plummeted by 40.1%.

Chancellor Rishi Sunak said: “In line with many other economies around the world, coronavirus is having a severe impact on our economy.

“The lifelines we’ve provided with our furlough scheme, grants, loans and tax cuts have protected thousands of businesses and millions of jobs – giving us the best chance of recovering quickly as the economy reopens.

“We’ve set out our plan to gradually and safely reopen the economy.

“Next week, more shops on the high street will be able to open again as we start to get our lives a little bit more back to normal.”