Box sets » Real GDP

The coronavirus pandemic has affected economies of all countries around the world as a result of public health measures and voluntary social distancing. In this box we assessed how the UK had fared relative to other major advanced economics by examining the effect of using different measures of government output, the composition of these economies and the severity of the virus.
Output held up better in November 2020 than we had expected at the time of our November 2020 forecast. In light of this, this box considered whether the economy had become increasingly adapted to operating under lockdowns and other public health restrictions since the onset of the pandemic, and the implications that this might have had for the economy during the January 2021 lockdown.

Economy categories: GDP by expenditure, Real GDP, Household consumption

Cross-cutting categories: Coronavirus

The unusual nature and size of the prevailing economic shock, and the Government’s fiscal response, raised the question of whether our usual fiscal multipliers were appropriate at the time. This box set out competing arguments for the multipliers being larger or smaller than those we usually employ and concluded that we would leave them largely unchanged.
Is the UK entering recession?
Monthly output data and the PMIs weakened in the second quarter of 2019, leading some commentators to suggest GDP would fall. This box considered what was behind the weaker data and whether it would persist into the third quarter, leading to a technical recession.

Economy categories: Real GDP

Rewriting history – output growth since 2010
Revisions to National Accounts data are a normal part of the Blue Book process, which reconciles the different measures of GDP and incorporates information from annual data sources. This box explored how the estimated path of real GDP growth since 2010 has evolved over time, focusing in particular on revisions to GDP growth in 2012.

Economy categories: Real GDP

Cross-cutting categories: Data revisions

G7 growth and investment since the EU referendum
The vote to leave the EU had caused in a a slowdown in real GDP growth in the UK, with the main driver being weak investment growth. This box compared UK growth and investment since the referendum to that in the other major advanced countries in the G7.

Economy categories: Real GDP

Cross-cutting categories: International comparisons

Rewriting recent history: real GDP revisions
Revisions to National Accounts data are a normal part of the Blue Book process, which reconciles the different measures of GDP and incorporates information from annual data sources. This box explored how the estimated path of the 1990-92 and 2008-09 recessions and subsequent recoveries evolved over time, focusing in particular on revisions to GDP growth in 2011 and 2012.

Economy categories: Economic data revisions, Real GDP

Cross-cutting categories: Data revisions, Blue Book

Fiscal policy and growth
Over the past six years there has been a large discretionary fiscal tightening in the UK. This box set out estimates of the effect of fiscal policy changes on GDP growth, based on estimates of the consolidation produced by the Institute for Fiscal Studies (IFS) together with estimates of fiscal multipliers, which are drawn from the available empirical literature. The box also considered how changes in discretionary fiscal policy compared with our forecast errors for GDP growth.

Economy categories: Real GDP

Cross-cutting categories: Fiscal multipliers, External forecasts

External forecasters’ revisions to GDP growth and borrowing
Our 2016 Forecast evaluation report was published around four months after the EU referendum was held. Over that period forecasters had revised their real GDP growth and borrowing forecasts. This box summarised those revisions and the relationship between them. It illustrated the uncertainty that forecasters faced in trying to predict the impact of the referendum result and Brexit on the economy and public finances.

Economy categories: Real GDP

Fiscal categories: Public sector net borrowing

Cross-cutting categories: Forecast process, External forecasts

Between 2012 and 2014, growth in the UK picked up, outpacing all other members of the G7. This box provided wider context for this strength in UK growth, comparing GDP, employment and productivity growth across G7 countries since 2008.
Contributions to UK net trade
This box decomposed the net trade contribution to GDP growth into its various drivers, to illustrate the sources of the negative contribution in the seven years before the late-2000s recession, the positive contribution in the seven years after the recession and the negative contribution in the December 2014 forecast.

Economy categories: GDP by expenditure, Net trade, Real GDP

GDP per capita and productivity
This box showed how growth in some of the key economy variables between 2010 and 2013 was lower when measured on a per capita basis. We also discussed our forecast for productivity growth at that time, given its importance in determining GDP per capita growth in the medium term.
The performance of past OBR economic and fiscal forecasts
Each autumn, we publish our Forecast evaluation report (FER), a detailed examination of the performance of past economic and fiscal forecasts relative to the latest outturn data. This box discussed cumulative errors in our June 2010 real and nominal GDP forecasts in light of the significant revisions made by the ONS to real GDP growth between mid-2010 and mid-2012, and the implications this has had for the performance of our June 2010 public sector borrowing forecast
Rewriting history: the 1990s recession and recovery
Revisions to National Accounts data are a normal part of the Blue Book process, which reconciles the different measures of GDP and incorporates information from annual data sources. This box explored how the estimated path of the 1990s recession and recovery evolved from estimates made in the 1992 Blue Book to estimates made in the 2013 Blue Book.

Economy categories: Economic data revisions, Real GDP

Cross-cutting categories: Data revisions, Blue Book

How has the story changed since last year?
In our 2012 Forecast Evaluation Report, we noted that nominal GDP had held up closer to our June 2010 forecast than real GDP, helping to explain why our fiscal forecasts out to 2011-12 had remained broadly on track. This box in our 2013 Forecast Evaluation Report discussed how this assessment changed in light of revisions to GDP data. While nominal GDP now appeared to be weaker than forecast, the relatively tax-rich components - such as nominal consumption and wages and salaries - held up relatively well.
Rewriting history: the 2008-09 recession and recovery
Revisions to National Accounts data are a normal part of the Blue Book process, which reconciles the different measures of GDP and incorporates information from annual data sources. This box explored the different picture of the late 2000s recession and recovery in light of the 2012 Blue Book.

Economy categories: Economic data revisions, Real GDP

Cross-cutting categories: Data revisions, Blue Book

In October 2011, we published our first Forecast evaluation report (FER). This box summarised the key findings, including a discussion of weaker than expected GDP growth and why, despite this, public sector borrowing has fallen broadly as we expected it would.
Rewriting history: the 1990s recession and recovery
Each year, the ONS publishes the National Accounts ‘Blue Book’. The revisions it contains are often a source of revisions to our subsequent forecasts. In this box, we illustrated the scope for history to be rewritten by exploring how the reported pattern of the recession and recovery of the early 1990s had evolved between the Blue Books published shortly after the recession and the most recent Blue Books available at the time.

Economy categories: Economic data revisions, Real GDP

Cross-cutting categories: Data revisions, Blue Book

International comparisons of productivity
The UK, the US and Germany all saw broadly similar falls in GDP over 2009, but their labour markets responded differently. This box discussed these differences and compared the behaviour of employment, hours and productivity over this period.
Rewriting history: real GDP growth in 2010
Both forecasts and National Accounts data are subject to revision. This box discussed how outside forecasts for growth in 2010 evolved through that year and compared these forecasts with ONS outturns, from the ONS' first estimate made in January 2011 through to their latest available estimate in February 2012.

Economy categories: Economic data revisions, Real GDP

Cross-cutting categories: External forecasts, Data revisions

Will household deleveraging act as a drag on growth?
The path of the household debt-to income ratio since the crisis had led outside commentators to conclude that household deleveraging had further to run in the UK than the in the US. This box discussed some of the limitations of debt-to-income as a measure of leverage. An alternative measure is the debt to equity ratio - which takes into account both household assets and liabilities - which indicated that household leverage had fallen more slowly in the US than in the UK since the crisis.

Economy categories: Real GDP, Household balance sheet

Rewriting history: the 1990s recession and recovery
Revisions to National Accounts data are a normal part of the Blue Book process, which reconciles the different measures of GDP and incorporates information from annual data sources. This box explored how the estimated path of the 1990s recession and recovery evolved from estimates made in the 1992 Blue Book to estimates made in the 2011 Blue Book.

Economy categories: Nominal GDP, Economic data revisions, Real GDP

Cross-cutting categories: Data revisions, Blue Book

Revisions to National Accounts data are a normal part of the Blue Book process, which reconciles the different measures of GDP and incorporates information from annual data sources. This box set out the key differences between the vintage of data used for the purposes of the October 2011 Forecast Evaluation Report and the data consistent with the 2011 Blue Book.