Monthly real gross domestic product (GDP) is estimated to have fallen by 0.5% in July 2023.
The Office for National Statistics (ONS) said the decline - which was worse than many economists had expected - followed an unrevised 0.5% increase in GDP in June 2023.
All main sectors fell in July 2023, with services falling by 0.5%, following growth of 0.2% in June 2023. Production and construction both retreated by 0.7% and 0.5%, respectively. This is the first month since June 2022 that all three sectors contributed negatively to GDP.
Official figures have suggested that July was a weaker month for retail and construction due to the poor weather, with industrial strike action in July 2023 having an impact on different industries.
Following the latest GDP figures, Mike Randall (pictured), CEO at Simply Asset Finance, commented: “As GDP sees yet another fall this year, its clear economic uncertainty continues to hinder business performance. Yet while interest rates remain at an all-time high, we’re seeing signs of firms continuing to invest in their operations to maintain their growth.
“The Government’s recent small business survey has reflected this sentiment as over a quarter (26%) expect to grow their staff numbers in the next year, and 74% to increase their sales within three years. And, perhaps most interestingly, three-quarters (75%) of SMEs are now using some form of external finance to support their growth.
“Evidently, its clear businesses can’t walk the path to growth alone. Access to finance, and a reliable financial partner that understands their goals, will be crucial to support UK SMEs in achieving these business goals – and also the key to supporting further GDP growth.”