The United Kingdom's economy grew by 1.1 percent in 2024, after a growth rate of 0.3 percent in 2023, 5.1 percent in 2022, 8.5 percent in 2021, and a record ten percent fall in 2020. During the provided time period, the biggest annual fall in gross domestic product before 2020 occurred in 2009, when the UK economy contracted by 4.6 percent at the height of the global financial crisis of the late 2000s. Before 2021, the year with the highest annual GDP growth rate was 1973, when the UK economy grew by 6.5 percent. UK economy growing but GDP per capita falling In 2022, the UK's GDP per capita amounted to approximately 37,371 pounds, with this falling to 37,028 pounds in 2023, and 36,977 pounds in 2024. While the UK economy as a whole grew during this time, the UK's population grew at a faster rate, resulting in the negative growth in GDP per capita. This suggests the UK economy's struggles with productivity are not only stagnating, but getting worse. The relatively poor economic performance of the UK in recent years has not gone unnoticed by the electorate, with the economy consistently seen as the most important issue for voters since 2022. Recent shocks to UK economy In the second quarter of 2020, the UK economy shrank by a record 20.3 percent at the height of the COVID-19 pandemic. Although there was a relatively swift economic recovery initially, the economy has struggled to grow much beyond its pre-pandemic size, and was only around 3.1 percent larger in December 2024, when compared with December 2019. Although the labor market has generally been quite resilient during this time, a long twenty-month period between 2021 and 2023 saw prices rise faster than wages, and inflation surge to a high of 11.1 percent in October 2022.

In the second quarter of 2025, the unemployment rate in the United Kingdom was highest in England, where it was 4.8 percent, followed by Wales at 4.3 percent, Scotland at 3.8 percent, and 2.4 percent in Northern Ireland, the lowest rate among the four countries of the UK. For all four countries, the peak in unemployment during this period was in the early 2010s. England and Scotland's unemployment rates were highest in Q4 2011 at 8.4 percent and 8.6 percent respectively, with unemployment reaching 9.7 percent in Wales during Q3 2011. Northern Ireland reported its highest unemployment rate in Q1 of 2013 when it reached eight percent. Unemployment ticking up as UK enters 2025 For the United Kingdom as a whole, the unemployment rate was 4.4 percent in November 2024, the joint-highest rate recorded since August 2021. After reaching 8.5 percent in late 2011, unemployment in the UK fell quite consistently for several years, with this recovery interrupted by the COVID-19 pandemic, which saw unemployment rise to 5.3 percent in late 2020 and early 2021. From this point onwards, however, the labor market bounced back, and was particular strong in 2022 when there were a record number of job vacancies and unemployment fell to as low as 3.6 percent. While the labor market cooled throughout 2023 and 2024, unemployment remained at historically low levels. Overall economy grows but GDP per head falls Throughout the whole of 2024, gross domestic product in the UK grew by 0.9 percent, but in the third quarter of the year, there was no economic growth, followed by the relatively weak growth rate of 0.1 percent in the fourth quarter. Furthermore, GDP per head in the UK, declined for a second-consecutive year, and was just 36,977 pounds in 2024, compared with 37,371 pounds in 2022. Inflation, meanwhile, has fallen from the peak of 11.1 percent in October 2022, but was still at the relatively high rate of 4 percent at the start of 2024, with this falling to 2.5 percent by the end of the year.