The UK's economic recovery has hit a significant slowdown, with official figures revealing growth of just 0.1% between July and September 2025.
This disappointing performance falls below economic forecasts and arrives at a critical juncture, placing immense pressure on Chancellor Rachel Reeves ahead of her pivotal Autumn Budget, scheduled for November 26.
Breaking Down the GDP Figures
According to data from the Office for National Statistics (ONS), UK real GDP increased by a mere 0.1% in Quarter 3 (Q3). This marks a sharp deceleration from the 0.3% growth recorded in the previous quarter (April to June).
When compared to the same period last year, GDP is estimated to have grown by 1.3%.
The growth was primarily driven by the services sector, which saw a 0.2% increase, and construction, which edged up by 0.1%. However, these modest gains were undermined by a 0.5% fall in the production sector.
In a further sign of economic strain, real GDP per head showed no growth in the latest quarter, increasing by just 0.8% compared to a year ago.
Cybersecurity Incident and Sectoral Weakness
Liz McKeown, Director of Economic Statistics at the ONS, highlighted that manufacturing was a key source of weakness. She pointed to a "particularly marked fall in car production in September, reflecting the impact of a cyber incident".
This observation was echoed by Colette Mason, an AI Consultant at Clever Clogs AI in London, who stated the cybersecurity hack had a tangible impact. "We now have statistical proof that a single point of digital failure can create a measurable drag on the national economy," she said.
Mounting Pressure on the Government
Business leaders expressed deep concern about the economic outlook. Emma Jones, Managing Director of Whenthebanksaysno.co.uk, noted that the sluggish growth, combined with recent unemployment figures hitting 5%, "will pile even more pressure on the government".
She warned that with the Budget looming, "2026 is shaping up to be a seriously challenging year for business".
Philly Ponniah, a Chartered Wealth Manager, described the outlook as "fragile" and emphasised the need for clarity. "People and businesses are waiting for clear signals on tax and any policy changes in the Budget so they can plan with confidence," she added.
