The UK economy expanded by 0.3% in November, outpacing economists’ expectations and marking a rebound after a 0.1% contraction in October, the Office for National Statistics (ONS) reported on Wednesday.
Growth was driven by a rise in industrial output and a boost to services, reflecting the return of car production at Jaguar Land Rover and increased activity around the November Budget. Motor vehicle output surged 25.5% in November, following a halt at JLR plants in September caused by a cyber-attack. Production resumed in stages from October, helping to lift overall industrial figures.
Services, particularly accounting and tax consultancy, also contributed to the increase. Economists said businesses appeared to respond positively once Budget details were announced. Yael Selfin, chief economist at KPMG UK, said the growth showed that “economic activity had accelerated despite uncertainty in the lead up to the Budget.” She added that there were early signs of an increase in household spending and that growth momentum could continue in the coming months.
Suren Thiru, economics director at the Institute of Chartered Accountants in England and Wales, described the November figures as “unexpectedly upbeat,” suggesting that most sectors had “seemingly shrugged off pre-Budget uncertainty.” He noted that the data indicated modest growth across the final quarter of 2025, despite disruptions in sectors such as education caused by the so-called ‘super flu.’
The ONS also revised September’s growth figures up to 0.1%, from a previously reported decline of 0.1%. Over the three months to November, the economy grew 0.1% compared with the previous quarter.
Not all sectors experienced gains. Construction output fell 1.3% in November, marking the largest three-month decline in nearly three years. Ruth Gregory, deputy chief economist at Capital Economics, said the drop was likely linked to “unseasonably wet weather” and predicted a rebound in December. She added that the increase in services mainly “reverses the big declines in the past few months,” suggesting November’s growth may reflect a short-term rebound rather than a fundamental improvement.
Government officials highlighted ongoing efforts to support the economy. A Treasury spokesperson said the government was making the economy “work for working people” by investing in infrastructure and implementing planning reforms. The spokesperson added that work continues to reduce bills and inflation.
Shadow Chancellor Mel Stride expressed scepticism about the outlook, warning that economic growth was “still flatlining” and that rising taxes were weighing on businesses.
Deutsche Bank’s chief UK economist Sanjay Raja said the stronger-than-expected data could influence the Bank of England’s policy decisions, noting it may reduce pressure for an accelerated interest rate cut in February.
The mixed data points to a UK economy showing resilience in some areas, such as car manufacturing and services, while facing ongoing challenges in construction and consumer confidence.
