Economy records 0.3% growth in November

The UK economy recorded growth of 0.3% in November, according to official figures, showing an improvement for output at a time when households and businesses were anxiously awaiting details of the budget.

The Office for National Statistics (ONS) reported an improvement for industrial production on the previous month amid the phased restart of manufacturing at Jaguar Land Rover after August's cyber attack.

The ONS measured growth on a rolling three-month basis at 0.1% - a rise on the upwardly revised zero growth covering August-October.

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Economists have partly put that performance down to paralysis caused by the build-up to a budget dominated by signals of more pain to come, including an income tax hike.

Private sector surveys have suggested that consumer spending picked up following guidance, in mid-November, that the chancellor had backed away from imposing that measure.

The ONS data supported that view as services - the dominant force behind the UK economy - was the only major sector to show growth at the back end of the September-November window.

ONS director of economic statistics Liz McKeown said: "The economy grew slightly in the latest three months, led by growth in the services sector, which performed better in November following a weak October.

"This was partially offset by a fall in manufacturing, where three-monthly growth was still affected by the cyber incident that impacted car production earlier in the autumn.

"However, 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."

Construction has endured tough times across the board for more than a year, with the housebuilding sector worst hit.

Challenges have included weak business confidence and higher than expected borrowing costs, raising fears that the government's target of 1.5 million new homes for England by the end of the parliament will be missed by a large margin.

Recent surveys indicate, however, that the worst may be over and confidence is improving more widely now that the budget is behind firms and government has not ruled out help on business rates hikes beyond just pubs.

Yael Selfin, chief economist at KPMG UK, said of the ONS data: "With the worst of the uncertainty behind businesses, we expect growth momentum to continue over the coming months.

"Nonetheless, businesses remain concerned about the potential need for further taxes rises before Parliament ends and geopolitical tensions may also threaten growth this year.

"Despite the relatively mooted consumer sentiment so far and consumer-facing services output declining in November, there are some tentative signs of a pick-up in household spending. Inflation is also projected to decline, thanks to easing food and energy prices, which could support a recovery in discretionary spending."

(c) Sky News 2026: Economy records 0.3% growth in November