The downturn has affected a record number of sectors across British industry, a Lloyds Bank report shows
Economic output in the UK has fallen to its lowest level since nationwide lockdowns shut down parts of the economy during the Covid-19 pandemic, Lloyds Bank data reveals.
In October, key areas of the British economy monitored by the UK Sector Tracker saw plummeting output on shrinking demand for goods and services. Twelve of the 14 sectors across manufacturing, services and construction experienced a drop in output last month, up from nine sectors in September.
The number of industries which recorded a decrease in new orders was the highest since the first lockdown in May 2020, the data shows.
The chemicals sector saw the weakest performance, with an index of 29.5, where a tracker reading above 50.0 indicates expansion. It was followed by metals and mining with 31.1, while household products stood at 38.4.
Since July, more than half of the UK sectors monitored by Lloyds Bank have consistently reported falling output and demand, indicating that economic conditions have worsened in recent months.
"The indications from our report suggest that the UK economy may already be in recession. With both our domestic challenges and global headwinds unlikely to materially recede in the short term, the key question revolves around how long this downturn may last", Head of Economics and Market Insight at Lloyds Bank, Jeavon Lolay, said.
Chemicals, metals and mining, household products and banks also saw a slump in staffing levels in October, the highest number since February 2021.
Analysts say that soaring inflation was behind the decline, forcing businesses and consumers to cut back on spending and investment to cope with rising costs.
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