THE UK economy grew 0.1% in the final quarter of 2022, the Office for National Statistics (ONS) has said.
The ONS previously said that gross domestic product (GDP) was estimated to stay flat at 0.0% originally.
UK economy grew in the final months of 2022
GDP is a measure of the size of an economy. If it’s rising then the economy is growing, if it’s falling then it’s shrinking.
Economists had been predicting that the economy would shrink by 0.4% in the first quarter of 2023.
In April to June last year, the economy shrunk by 0.6%
The rise means the economy grew slightly between October and December last year when previously it was thought to be neither shrinking or increasing.
As a result, it means the UK has managed to avoid a recession.
A recession occurs when there’s a huge dip in the economy.
It tends to last for months of often years.
Darren Morgan, director of economic statistics at ONS said: “The economy performed a little more strongly in the latter half of last year than previously estimated, with later data showing telecommunications, construction and manufacturing all faring better than initially thought in the latest quarter.”
“Households saved more in the last quarter, with their finances boosted by the government’s energy bill support scheme.
“Meanwhile, the UK’s balance of payments deficit with the rest of the World narrowed, driven by increased foreign earnings by UK companies, particularly in the energy sector.”
What is a recession and what does it mean for your finances?
Recessions are worrying because they tend to lead to unemployment and wage stagnation.
This consequently means the government gets less tax, which could mean cuts to services and benefits, or that rates go up.
There are lots of different reasons why a country may head into recession.
The UK last went into recession in 2020 due to the coronavirus pandemic, and there was a more severe one in 2008/9 when the global financial crisis hit.
Going into recession can have a big impact on your finances and job losses are common as companies let people go to cut their costs and stay afloat.
Job losses are common, as companies try to cut their costs to stay afloat.
The number of people in debt and arrears is also likely to soar, and there could be more defaults on loans and mortgages or repossessions and bankruptcies.
There are some things you can do to shore up your finances if you’re worried about recession.
Tracking your monthly outgoings, making a note of the date that bills are paid and looking for areas to cutback is a good first step.
Use a benefits calculator to see if you’re entitled to any extra help. Millions of people qualify for cost-of-living payments of up to £1,700 – find out what you can get.
If you are behind on bills, speak to your providers.
Do you have a money problem that needs sorting? Get in touch by emailing money-sm@news.co.uk
