What happened to the UK economy in 2021? New figures show record growth despite December Omicron hit

The UK economy grew by 7.5% last year despite falling in December due to the Omicron wave, according to official figures.

The growth in 2021 exceeded Bank of England projections and was the fastest since records began in 1948.

However, it comes after a record 9.4% slump in the economy in 2020 due to the coronavirus pandemic.

What happened to the UK economy in 2021?

New Office for National Statistics (ONS) data showed that the economy grew by 1% in the final three months of 2021 - despite the impact of the spread of the Omicron variant.

The economy contracted by 0.2% in December, with the hospitality and leisure sector feeling the brunt of the Government’s Covid restrictions.

However, the economy remained at pre-pandemic levels from February 2020

The ONS also said the services sector grew by 1.2% over the latest quarter.

That means it is now 0.5% bigger than before the pandemic, although this area reported decline in December.

The latest figures also showed that production output fell by 0.4% for the quarter.

What has Chancellor Rishi Sunak said about the figures?

Chancellor Rishi Sunak said: “Thanks to our £400 billion package of support and making the right calls at the right time, the economy has been remarkably resilient; with the UK seeing the fastest growth in the G7 last year and GDP remaining at pre-pandemic levels in December.

“I’m proud of the resolve the whole country has demonstrated, and proud of our incredible vaccine programme which has allowed the economy to stay open.

“We’re continuing to help the economy rebuild through our Plan for Jobs, boost for business investment and support for households with the cost of living.”

What the ONS said about the figures

ONS director of economic statistics Darren Morgan said: “GDP fell back slightly in December as the Omicron wave hit, with retail and hospitality seeing the biggest impacts.

“However, these were partially offset by increases in the Test and Trace service and vaccination programmes.

“Despite December’s setback, GDP grew robustly across the fourth quarter as a whole, with the NHS, couriers and employment agencies all helping to support the economy.”

Mr Morgan added that although GDP in December was in line with levels from February 2020, the fourth quarter as a whole was “slightly below” the same period in 2019, before the pandemic struck.

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