COVID-19 SERVICE: We are heightening our efforts to assist the UK retail & leisure industry through this challenging period. Explore this service now… COVID-19 SERVICE

UK GDP - Q4 2023 Preliminary Estimate


  • Quarterly GDP is estimated to have fallen by 0.3% in Q4 2023 (October to December), following an unrevised fall of 0.1% in the previous quarter.
  • Although the economy has contracted for two consecutive quarters, GDP is estimated to have increased by 0.1% across 2023 compared with 2022. 
  • In Q4 2023 there were falls in all main sectors, with declines of 0.2% in services, 1.0% in production and 1.3% in construction output.

UK GDP declined by 0.3% in Q4 2023

By Sector: 


  • Services output decreased by 0.2% in Q4 2023, declining for the third consecutive quarter. There were falls in 8 of the 14 sub-sectors. 
  • The main driver of the decline in Q4 was a 0.6% fall in the wholesale and retail trade; repair of motor vehicles and motorcycles sub-sector. Indeed, December 2023 saw the largest monthly decrease in retail sales since January 2021, according to the ONS. 
  • Education also contributed to the decline in the sector, recording a fall of 0.8% due to a decrease in school attendance. Other personal services fell 3.4% in the period, driven by lower than usual consumption of hairdressing services and other beauty treatments in the Christmas period.
  • The largest positive contributor was administrative and support service activities, which grew by 0.6% in the period, driven by an increase in rental and leasing activities. 
  • Overall, consumer-facing services fell by 0.7% in Q4 2023, primarily driven by falls in good and beverage service activities, and retail trade, except of motor vehicles and motorcycles.


  • Production output decreased 1.0% in Q4 2023, following 0.1% growth in the previous quarter. On a monthly basis, October saw a 1.4% fall while November (0.5%) and December (0.6%) both saw weak increases. 
  • The fall in production output in the latest quarter was mainly driven by a decrease of 0.9% in manufacturing, which saw falls in 10 out of the 13 sub-sectors in the period. The largest negative contributions were from the manufacture of machinery and equipment n.e.c (-7.0%) and the manufacture of rubber and plastic products, and other non-metallic mineral products (-4.7%). 
  • On the other hand, the manufacture of transport equipment grew by 1.8% in the period, while anecdotal evidence from the Society of Motor Manufacturers and Traders (SMMT) suggests car manufacturing increased 20.7% YoY in December 2023.


  • Construction output fell by 1.3% in Q4 2023, following growth of revised growth 0.1%. 
  • This was driven by a fall in new work of 0.5%, although growth of 4.0% in repair and maintenance was recorded.
  • Construction is estimated to have grown 2.0% in 2023.

UK GDP declined across all main sectors

Source: ONS

Household consumption 

  • Real household expenditure fell by 0.1% in Q4 2023, following a downwardly revised fall of 0.9% in Q3. 
  • Household consumption is estimated to have increased by 0.3% in 2023, following a 4.8% increase in 2022.

Back to Retail Economic News