GDP monthly estimate, UK : July 2022

• Gross domestic product (GDP) is estimated to have grown by 0.2% in July 2022 following a fall of 0.6% in June 2022; for more information on June 2022, please see the GDP monthly estimate, UK : June 2022 bulletin.

• Looking at the broader picture, GDP was flat in the three months to July compared with the previous three months.

• Services grew by 0.4% in July 2022, after a fall of 0.5% in June 2022, and was the main driver to the rise in GDP; information and communication grew by 1.5% and was the largest contributor to the services growth in July.

• Production fell by 0.3% after a fall of 0.9% in June 2022; this was mainly because of a fall of 3.4% in electricity, gas, steam, and air conditioning supply.

• Construction also fell in July 2022 by 0.8%, after a fall of 1.4% in June 2022; the decrease in monthly construction output in July 2022 came solely from repair and maintenance, which fell 2.6%.

• Output in consumer-facing services grew by 0.6% in July 2022, following flat growth in June 2022; consumer-facing services remained 4.3% below their pre-coronavirus (COVID-19) levels (February 2022) in July 2022.

Monthly real gross domestic product (GDP) is estimated to have grown by 0.2% in July 2022 (Figure 1) following a fall of 0.6% in June 2022. For more information on June 2022, please see the Monthly GDP release June 2022 bulletin.

Monthly GDP is now estimated to be 1.1% above its pre-coronavirus (COVID-19) levels (February 2020).

The services sector grew by 0.4% in July 2022 and was the main driver to the rise in GDP. However, both production and construction fell in July 2022, by 0.3% and 0.8% respectively, and this was the second consecutive fall for both these sectors (Figure 2).

GDP was flat in the three months to July 2022, with a 0.2% fall in services offset by rises of 0.6% in production and 1.4% in construction.

Monthly GDP grew 2.3% between July 2021 and July 2022, up from 1.9% between June 2021 and June 2022.

Services grew by 0.4% in July 2022, following a fall of 0.6% in June 2022. Figure 3 shows the contributions from the services sector to gross domestic product (GDP) in July 2022.

Information and communication grew by 1.5% in July 2022 and was the largest contributor to July's growth in services (Figure 3). The main driver of this growth was computer programming, consultancy and related activities, which grew by 1.5% in the month and telecommunications, which grew by 1.9%.

Human health and social work activities saw growth of 0.8% in July 2022, the main driver of this growth was human health activities, which grew by 1.1% in the month. There were increases in GP appointments and critical care in July 2022, offset by a fall in A&E attendances.

The largest negative contributor to services in July 2022 was professional, scientific and technical activities, which fell by 0.8% in the month. The largest drivers of this fall were advertising and market research (which fell by 5.2% in July 2022), architectural and engineering activities, and technical testing and analysis (which fell by 4.2% in July 2022). These falls were partially offset by a 5.2% rise in accounting, bookkeeping and auditing activities, and tax consultancy.

NHS Test and Trace services and vaccine programmes

NHS Test and Trace and COVID-19 vaccination programme activity increased by 16% in July 2022, driven entirely by growth in Test and Trace volumes. Test and Trace volumes in June grew by 33% compared with June 2022. There were also increases in both lateral flow and polymerase chain reaction (PCR) testing, with lateral flow tests being the principal driver. Vaccine volumes fell by 21%, as the "fourth dose" booster programme for at-risk groups continued to tail-off. Overall, the NHS Test and Trace and the coronavirus (COVID-19) vaccination programme contributed negligibly to monthly GDP growth.

A full record of the volume estimates of Test and Trace and vaccination programmes, along with their contribution to GDP growth, can be found in the accompanying dataset.

Consumer-facing services

Output in consumer-facing services grew by 0.6% in July 2022, following a flat month in June 2022. Consumer-facing services were 4.3% below their pre-coronavirus levels (February 2020) in July 2022, while all other services were 3.0% above (Figure 4).

The largest positive contributor in consumer facing services was the wholesale and retail trade and repair of motor vehicles and motorcycles industry, which grew by 4.0% in July 2022. The second largest driver in consumer facing services growth was sports activities and amusement and recreation activities, which saw growth of 8.1%, in a month that included the UK hosting both the Women's EURO Championship and Commonwealth Games.

These growths were partially offset by a fall of 4.5% in other personal service activities, after continuous growth in this industry since November 2021. Also contributing negatively to growth in consumer-facing services was buying and selling, renting and operating of own or leased real estate, excluding imputed rent, which fell by 0.3% in July 2022.

Overall, services fell by 0.2% in the three months to July 2022, with negative growth seen in six of the 14 services sectors partially offset by positive contributions in the other eight services sectors.

More detailed breakdowns on services are available in the Index of Services, UK: July 2022.

Production output fell by 0.3% in July 2022, with electricity, gas, steam and air conditioning supply as the main driver of negative growth, falling by 3.4% on the month having previously increased by 3.1% in June.

Within electricity, gas, steam and air conditioning supply the main driver of negative growth was electric power generation, transmission and distribution, which fell by 4.4%, with manufacture of gas also falling by 0.5%. According to anecdotal evidence from the Department for Business, Energy and Industrial Strategy (BEIS), demand for electricity was 2.3% lower than seen in July 2021 (that may have been influenced by the higher than usual temperatures). Anecdotal evidence suggests that there may be some signs of changes in consumer behaviour and lower demand in response to increased prices. This is further shown in our recent Consumer price inflation, UK: July 2022 bulletin where electricity prices rose by 54% in the 12 months to July 2022.

Manufacturing increased by 0.1% in July 2022, with a mixed performance across the sub-sectors. There were growths of 3.3% in manufacture of machinery and equipment, 2.4% in manufacture of wood and paper products, and printing, and 1.3% in manufacture of transport equipment.

Within the manufacturing of transport equipment, the manufacture of vehicles, trailers, and semi-trailers industry has now seen five consecutive monthly increases, which might suggest supply shortages are beginning to ease. However, production is still well below its previous peak from December 2021.

These growths were largely offset by falls in other manufacturing, and repair and manufacture of basic pharmaceutical products and pharmaceutical preparations, which both fell by 2.3% on the month.

Water supply and sewerage decreased by 2.1% in July 2022, with sewerage (down 2.8%) and waste collection, treatment and disposal activities (down 3%), both contributing negatively to growth. Mining and quarrying grew by 3.5%, owing to 4.6% growth in extraction of crude petroleum and natural gas.

Overall, production increased by 0.6% in the three months to July 2022, with growths in all four sub-sectors. The two main contributors were manufacturing, and electricity, gas, steam and air conditioning supply, which saw growths of 0.3% and 2.4% respectively. Water supply and sewerage increased by 1.1% and mining and quarrying grew by 0.6% over the same period.

More detailed breakdowns on production are available in our Index of Production, UK: July 2022 bulletin.

Construction output decreased by 0.8% in July 2022, after a 1.4% fall in June 2022. This follows seven consecutive months of growth in the sector between November 2021 and May 2022.

The decrease in monthly construction output in July 2022 came solely from repair and maintenance, which fell 2.6%. This was partially offset by a small rise in new work (0.3%). At the sector level, seven of the nine sectors saw a decrease on the month in July 2022, with all sectors in repair and maintenance seeing a fall. Public housing (both new work and repair and maintenance) also saw notable falls of 13.1% and 8.0%, respectively.

As in previous months, high prices for certain construction products, most notably concrete, plaster, bricks, sand, gravel and asphalt-related products, continue to be an issue in the industry. The annual rate of all construction work price growth is 9.6% in June 2022, this is a record high since the Construction Output Price Indices series began in January 2014. For more information, see our Construction output price indices.

Despite these record prices, demand for work still persists. Figure 7 illustrates the strong demand in value terms, which is 17.5% above pre-coronavirus (COVID-19) (February 2020) levels compared with only being 2.1% above in volume terms, that is, after removing the impact of price changes in July 2022.

Construction output rose 1.4% in the three months to July 2022. This is this slowest rate of growth in the three-month on three-month series since December 2021 (1.0%). The increase in output in the three months to July 2022 came from new work (2.7%), as repair and maintenance saw a decline (0.7%). 

Further detail on construction output growth rates can be found in our Construction output in Great Britain: July 2022 bulletin.

There were some common themes that were anecdotally reported (as part of the Monthly Business Survey) to have played a part in performance across different industries. However, it is often difficult to quantify these effects.

The Met Office reported that mean temperatures in July were the joint-fifth warmest since 1884, with 40 degrees Celsius being exceeded for the first time in the UK. The heat seems to have had an effect on the economy, with the weather being reported as a reason for increased turnover in:

• ice cream manufacturing

•  amusement parks

•  golf clubs

•  maintenance and repair of vehicles

•  boat hire

•  marquee hire

•  lidos and outdoor pools

•  wholesale of water coolers

•  wholesale of fruit

• the provision of courier services, where increased deliveries of summer clothing and fans were reported

Businesses also reported staff shortages as being an issue. Hotels and hospitality services were particularly badly affected, but comments were also received from manufacturers of health and beauty products, sheet metal fabricators, haulage companies, solicitors, and cleaning companies. This is also shown in our Business insights and impact on the UK economy: 28 July 2022 bulletin that found of businesses not permanently stopped trading with 10 or more employees, 35% reported that they were experiencing a shortage of workers in mid-July 2022. In particular, over half (54%) of businesses in the accommodation and food service activities industry reported they were experiencing a shortage of workers. On the other hand, the employment activities industry performed well in July 2022, growing by 2.1% as ongoing staff shortages boosted demand for this service.

In line with our National Accounts Revisions Policy: updated December 2021, there are no revisions to previously published data, and July 2022 is being published for the first time.

In Blue Book 2022, a wide range of improvements to sources and methods will be incorporated into the accounts, these include:

• measuring the insurance industry using Solvency II regulatory data for the first time

• completing the transition to the improved Financial Survey of Pension Schemes

• a package of better sources and methods that improve the international comparability of the UK gross domestic product (GDP) estimates

• estimating 2020 for the first time using the Supply and Use Tables (SUTs) framework, which looks at the supply of goods and services on a very detailed level, how they are used in the economy, and their associated prices

These improvements will be reflected in our September quarterly national accounts and October monthly GDP estimates.

In our Impact of Blue Book 2022 changes on current price and volume estimates of gross domestic product article, we showed the indicative annual impacts for the period 1997 to 2019. On 20 June 2022, our Insurance and pensions methods changes: 1997 to 2020 methodology was released.

Additional analysis was published on 22 August 2022 in our Impact of Blue Book 2022 changes on gross domestic product article. This provided indicative impacts on GDP for the period 2020, including the new quarterly and monthly industry detail. These changes will be taken on in our next monthly GDP release, on 12 October 2022.

In addition, the next monthly GDP release on 12 October 2022 will also see revisions to the periods January 1997 to June 2022 in line with the National Accounts Revision Policy. These revisions will be consistent with the Quarterly National Accounts release published on 30 September. They will incorporate the Blue Book 2022 changes, improved source data and additional updated data as would happen in all quarterly national accounts releases, this includes new Value Added Tax (VAT) turnover data for Quarter 4 (Oct to Dec) 2021 and Quarter 1 (Jan to Mar) 2022. In the next monthly release, July 2022 will also be open for revision.

Contribution to growth

Contribution to growth indicates how many percentage points a sector or industry is adding or removing from a given growth rate, usually headline gross domestic product (GDP) growth.

Gross domestic product

A measure of the economic activity produced by a country or region. GDP growth is the main indicator of economic performance. There are three approaches used to measure GDP:

• the output approach 

• the expenditure approach 

• the income approach

Index numbers

Data relative to a given base value, which typically refers to a year.

Rolling three-month growth

Rolling three-month growth takes the average level of three consecutive months (for example, April, May and June), and compares it with the average level of the previous three months (for example, January, February and March). The rolling three-month growth rate is often used alongside the monthly growth rate, as the latter can be more volatile.

For further definitions, please see the Glossary of economic terms.

Further information on measuring the data across our main data sources is available in the following releases:

• Construction output in Great Britain: July 2022

• Index of Production, UK: July 2022

• Index of Services, UK: July 2022

There have been large movements in UK gross domestic product (GDP) over the course of the coronavirus (COVID-19) pandemic. This is primarily in response to public health restrictions and voluntary social distancing that have been in place over this period. Given the size of these effects, there has been a focus on where the economy is relative to its pre-coronavirus pandemic levels.

In the UK, we produce estimates of monthly and quarterly GDP. However, there are reasons as to why these would not provide the same estimate as to where the economy is relative to its pre-coronavirus levels. This primarily reflects that monthly estimate of GDP are based on only the output measure of GDP, while quarterly estimates of GDP reflect the average of the three approaches (output, income and expenditure).

However, the coronavirus pandemic has brought many measurement challenges that have created more uncertainty around our three approaches. This has led to an initial divergence between the output and average estimate, which is then reflected in how we compare monthly and quarterly estimates of GDP. Further information is available in our Measuring monthly and quarterly UK gross domestic product during the coronavirus (COVID-19) pandemic article.

Estimates for the construction industry within monthly GDP will differ to those published in the construction output release, as they account for both the outputs produced and inputs consumed by the industry. There are also some coverage differences given the use of the Annual Business Survey in their compilation.

Within the monthly GDP publication, government data are sourced on a quarterly basis; a monthly forecast is used to estimate data for the monthly round until quarterly data are available. While this is a standard practice with many of our data sources, pre-empting the behaviour of a series during a pandemic, in particular for health and education, comes with more uncertainty than usual. Therefore, caution is advised when looking at the monthly estimates beyond the latest published quarter.

The Office for National Statistics (ONS) is aware of reclassifications or relocations of companies that may impact these published estimates of GDP and associated breakdowns. It is monitoring the data and will seek to implement any resulting changes into the national accounts as soon as possible.

Quality and methodology information on strengths, limitations, appropriate uses, and how the data were created is available in our Gross domestic product (GDP) QMI.

Monthly growth rates can be volatile. This indicator should therefore be used with caution and alongside other measures, such as the three-month growth rate, when looking for an indicator of the medium-term trend of the economy. However, it is useful in highlighting one-off changes that can be masked by three-month growth rates.

The latest comparisons of month on same month a year ago should be treated with caution given the impact of base effects on growth rates because of the economic impact of the coronavirus (COVID-19) pandemic throughout 2020 and 2021. Such comparisons and growth rates can be found in our accompanying dataset.