GDP monthly estimate, UK: July 2023

• There are no revisions to previously published data in this monthly release because of the regular National Accounts revision policy; we will see the data revisions from our pre-announced changes highlighted in our Impact of Blue Book 2023 article in the Quarterly National Accounts release (to be published on 29 September), and also in the next monthly GDP release (published on 12 October).

• For July 2023, monthly real gross domestic product (GDP) is estimated to have fallen by 0.5%, with falls in all three main sectors, following growth of 0.5% in June 2023.

• Looking at the broader picture, GDP increased by 0.2% in the three months to July 2023, with growth in all three main sectors.

• Services output was down 0.5% in July 2023, after growth of 0.2% in June 2023, and was the main contributor to the fall in GDP in July.

• Output in consumer-facing services showed no growth in July 2023, following growth of 0.5% in June 2023.

• Production output fell by 0.7% in July 2023, after growth of 1.8% in June 2023.

• The construction sector fell by 0.5% in July 2023, after growth of 1.6% in June 2023.

Monthly real gross domestic product (GDP) is estimated to have fallen by 0.5% in July 2023 (Figure 1) following growth of 0.5% in June 2023.  There are no revisions to previously published data in this monthly release because of the regular National Accounts revision policy. We will see the data revisions from our pre-announced changes highlighted in our Impact of Blue Book 2023 article in the Quarterly National Accounts release (to be published on 29 September), and also in the next monthly GDP release (published on 12 October).

Looking over a broader picture, GDP showed 0.2% growth in the three months to July 2023 when compared with the three months to April 2023. Production grew by 0.6% and was the main contributing sector to the three-month growth. Services and construction output also increased in the three months to July, both by 0.1%.

All of the main sectors fell in July 2023. Output in services sector fell by 0.5% and was the largest contributor to the fall in monthly GDP; production output fell by 0.7% and construction output fell by 0.5%. This is the first month since June 2022 that all three sectors contributed negatively to GDP on the month.

Monthly GDP showed no growth in July 2023 compared with the same month last year. For comparison, monthly GDP grew by 0.9% between June 2022 and June 2023. The Platinum Jubilee in 2022, and the move of the May bank holiday, led to an additional working day in May 2022 and two fewer working days in June 2022. It should also be noted that May 2023, saw one fewer working day as there was an additional bank holiday for the coronation of King Charles III. This should be considered when interpreting seasonally adjusted movements involving these months.

Services output fell by 0.5% in July 2023, following growth of 0.2% in June 2023. Overall, the services sector grew by 0.1% in the three months to July 2023 compared with the three months to April 2023. Figure 3 shows the monthly contributions from the services sector to gross domestic product (GDP) in July 2023.

The main contributor to the fall in monthly services output was the human health and social work activities sub-sector, which fell by 2.1% in July 2023. This was attributed entirely to a 3.4% fall in the human health activities industry. Industrial action was held in July by NHS senior doctors (two days) and radiographers (two days) for the first time while industrial action by junior doctors increased (five days in July, compared with three in June). NHS England reported that 65,557 appointments and procedures were cancelled because of the senior doctors strike and 101,977 acute inpatient and outpatient appointments were cancelled because of the industrial action by junior doctors.

The next largest contributor to the fall in services output in July 2023 was the 2.1% fall in information and communication, following on from three consecutive monthly growths in this sub-sector. Computer programming, consultancy and related activities was the largest contributing industry, falling by 3.4% in July after three consecutive monthly growths in April, May, and June 2023.

Administrative and support service activities also fell in July 2023, by 1.4%. The largest industry within this sub-sector was employment activities, which fell by 2.3% in July after a growth of 2.1% in June. This industry has had a decrease in monthly output in 9 of the last 12 months. Education also fell in July 2023, by 1.1%, where the sector saw two days of industrial action in England at the start of the month. Please note that education attendance is considered to be constant over the school year, so summer holidays and school leavers did not reduce the estimate of education output in July 2023.

The main offsetting positive contribution was from the arts, entertainment and recreation sub-sector, which grew by 6.6% in July 2023; this was its largest growth since May 2021. Sports activities and amusement and recreation activities grew by 12.4% and creative, arts and entertainment grew by 4.9%.

Consumer-facing services

Output in consumer-facing services showed no growth in July 2023, while all other services fell by 0.6%. The largest positive contributions to consumer-facing services in July 2023 came from the sports activities and amusement and recreation activities industry (up 12.4%) and wholesale and retail trade and repair of motor vehicles and motorcycles (up 2.2%).

The largest negative contributions came from retail trade, except of motor vehicles and motorcycles (down 1.2%) and travel agency, tour operator and other reservation service and related activities (down 3.2%).

On the three months to July, consumer-facing services have growth by 0.7%

More detailed breakdowns on services are available in our Index of Services, UK: July 2023.

Production output fell by 0.7% in July 2023, following growth of 1.8% in June 2023 (Figure 4). The largest falling sub-sector was manufacturing, which fell by 0.8% in July 2023.

Overall, production output grew by 0.6% in the three months to July 2023, compared with the three months to April 2023. Manufacturing was also the main contributor to the three-month growth, where manufacturing output grew by 1.7% in the three months to July 2023.

Manufacturing's 0.8% fall was the main contributor to the monthly fall in production, with 9 of its 13 subsectors down on the month (Figure 5). This follows growth of 2.4% in June 2023, the strongest monthly growth since November 2020, where a number of businesses told us that output increased in June 2023 compared with May 2023 because of the additional bank holiday in May.

Manufacture of rubber and plastics products and other non-metallic mineral products was the largest contributor to the fall, down by 5.5%. This is followed by the manufacturing of computer, electronic and optical products, which was down 3.2% in July. The largest offsetting positive contribution within manufacturing came from manufacture of machinery and equipment not elsewhere classified (NEC), which grew by 2.8%.

Mining and quarrying was the only production sub-sector to see increased output in July 2023, growing by 1.9%, caused by growth of 2.9% in the extraction of crude petroleum and natural gas.

Electricity, gas, steam and air conditioning supply fell by 1.5% in July 2023, caused by a 2.5% fall in electric power generation, transmission and distribution.

Water supply and sewerage fell by 0.5%, mainly attributed to a 1.6% fall in water collection, treatment and supply.

More detailed breakdowns on production are available in our Index of Production, UK: July 2023.

Monthly construction output is estimated to have decreased 0.5% in volume terms in July 2023. This follows a 1.6% increase in June 2023, where businesses told us that extremely good weather and an additional working day, compared with May, because of the additional bank holiday for King Charles III coronation, had boosted output.

The decrease in monthly output came solely from a decrease in repair and maintenance (1.3% fall), with new work increasing (0.1%) on the month. Five out of the nine sectors saw a decrease on the month.

At the sector level, the main contributors to the monthly decrease were private housing repair and maintenance and private housing new work, which decreased by 3.9% and 2.2%, respectively.

Anecdotal evidence received from returns for the Monthly Business Survey (MBS) for construction and allied trades suggested an effect from heavy rainfall and lower-than-average temperatures. The Met Office confirmed in their Monthly climate summary (PDF, 5.7MB) that July 2023 was the wettest July since 2009. Additional evidence also indicated a slow-down in the housing sector.

Further detail on construction output growth rates, along with new orders in the construction industry and construction output prices, can be found in our Construction output in Great Britain: July 2023 bulletin.

There were some common themes that were anecdotally reported (as part of the Monthly Business Survey (MBS) for production and services) to have played a part in performance across different industries. However, it is difficult to quantify the exact impact of each theme.

The industrial action in July 2023 had an impact on different industries to varying degrees. The health sector (junior doctors, senior doctors and radiographers), education sector (teachers in England) and rail network all undertook notable industrial action and this was an important factor as to the monthly decline in these industries. To a lesser degree, anecdotal comments were received to suggest demand for employment agencies from the health sector were also negatively affected by the industrial action in the NHS.

July 2023 also had wetter weather than normal, as detailed in the Met Office's July 2023 climate summary (PDF, 4.8MB), following a particularly warm June, calling it "the warmest June in a series since 1884". The July report mentioned "the UK overall rainfall total was 170% of average overall, making this provisionally the wettest July since 2009 and sixth wettest July in the series". The wet weather was cited as a reason for lower output in retail, as described in our Retail sales bulletin, and also in construction and outdoor accommodation venues.

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

• Construction output in Great Britain: July 2023

• Index of Production, UK: July 2023

• Index of Services, UK: July 2023

In the UK, we produce estimates of monthly and quarterly gross domestic product (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 (COVID-19) pandemic 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).

The coronavirus pandemic has brought many measurement challenges that have created more uncertainty around our three approaches, as set out in our Coronavirus and the effects on UK GDP article. 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.

Our GDP(O) data sources catalogue provides a full breakdown of the data used in this publication.

Additional bank holiday in May 2023 for the Coronation of King Charles III 

There was an additional bank holiday for the coronation of King Charles III on Monday 8 May 2023. While adjustments are made for regular calendar effects, there was no explicit adjustment for this ad hoc event. However, the timing of the bank holiday indirectly affects the number of trading days, which could affect GDP estimates positively or negatively, depending on the sector.

Office for Statistics Regulation (OSR) review of GDP

The OSR will shortly be completing a review of the practices around the preparation and release of information about revisions to estimates of GDP in our Impact of Blue Book 2023 article released on 1 September. This will cover the following:

• processes and quality assurance in making revisions to GDP

• potential improvements to early estimates of GDP enabled through enhanced access to data

• communication of revisions to GDP, the story behind the most recent set of revisions in particular, and uncertainty in early estimates of GDP

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

Monthly growth rates can be volatile. Therefore, this indicator should 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 (see our blog post, Beware Base Effects, for more information). Such comparisons and growth rates can be found in our accompanying dataset.