London Daily

Focus on the big picture.
Tuesday, Sep 16, 2025

Return to school unexpectedly boosts UK economy in January

Return to school unexpectedly boosts UK economy in January

Children returning to school after an illness-ravaged December provided an unexpected, one-off boost to Britain's economy in January, when growth in output exceeded forecasts, data showed on Friday.

The Office for National Statistics (ONS) said Britain's economy expanded 0.3% month-on-month, after a drop of 0.5% in December - a reading that is likely to further allay recession fears, at least in the short term.

A Reuters poll of economists had pointed to growth of 0.1%.

The pound rose against the dollar and euro on the back of the figures, which showed growth was powered entirely by services - much of it due to the one-off bounce in the education sector.

The entertainment sector - helped by the men's soccer Premier League returning to action after the 2022 World Cup - was another fillip for the economy.

In a sign of deeper problems for the economy, manufacturing and construction contracted.

"Looking beneath the surface, the figures suggest the economy is on weaker ground than it appears," Ruth Gregory, deputy chief UK economist at consultancy Capital Economics.

Martin Beck, chief economic advisor to the EY ITEM Club forecasting group, said widespread strikes in December and January likely explained why the economy remained below its level in November.

The ONS said economic output in January stood 0.2% below its pre-pandemic level of February 2020 - in contrast to other advanced economies - and had shown zero growth over the last three months and the past year.

Friday's data are unlikely to materially change the debate at the Bank of England as it weighs up whether to raise interest rates again at its March meeting.

The chance of a 25 percentage point increase in Bank Rate on March 23 receded slightly on Friday to about 83%, according to financial market pricing, from 100% earlier this week.

CLASSROOM ECONOMICS

Prime Minister Rishi Sunak said the fundamentals of Britain's economy were strong, adding that his finance minister Jeremy Hunt would announce more details about the government's economic plans in his upcoming annual budget.

Hunt looks set to keep his grip on the public finances in Wednesday's budget, refraining from big tax cuts or spending increases until the next election comes closer into view.

The opposition Labour Party, ahead of Sunak's Conservatives in the opinion polls by a wide margin, said the data showed the economy was only "inching along" amid a wider trend of managed decline.

The ONS said half of the 0.3% growth rate comprised the education sector, as a result of children returning to school after a significant drop in attendance in December.

The government had previously reported high rates of flu and scarlet fever during December. Fear of contracting COVID-19 over Christmas may also have contributed to children being taken out of school early.

Education represents 6% of Britain's economy and student numbers are the main way the ONS measures the quantity of service the sector provides.


Newsletter

Related Articles

0:00
0:00
Close
U.S. and Britain Poised to Finalize Over $10 Billion in High-Tech, Nuclear and Defense Deals During Trump State Visit
China Finds Nvidia Violated Antitrust Laws in Mellanox Deal, Deepens Trade Tensions with US
US Air Force Begins Modifications on Qatar-Donated Jet Amid Plans to Use It as Air Force One
Pope Leo Warns of Societal Crisis Over Mega-CEO Pay, Citing Tesla’s Proposed Trillion-Dollar Package
Poland Green-Lights NATO Deployment in Response to Major Russian Drone Incursion
Elon Musk Retakes Lead as World’s Richest After Brief Ellison Surge
U.S. and China Agree on Framework to Shift TikTok to American Ownership
London Daily Podcast: London Massive Pro Democracy Rally, Musk Support, UK Economic Data and Premier League Results Mark Eventful Weekend
This Week in AI: Meta’s Superintelligence Push, xAI’s Ten Billion-Dollar Raise, Genesis AI’s Robotics Ambitions, Microsoft Restructuring, Amazon’s Million-Robot Milestone, and Google’s AlphaGenome Update
Le Pen Tightens the Pressure on Macron as France Edges Toward Political Breakdown
Musk calls for new UK government at huge pro-democracy rally in London, but Britons have been brainwashed to obey instead of fighting for their human rights
Elon Musk responds to post calling for the murder of Erika Kirk, widow of Charlie Kirk: 'Either we fight back or they will kill us'
Czech Republic signs €1.34 billion contract for Leopard 2A8 main battle tanks with delivery from 2028
USA: Office Depot Employees Refused to Print Poster in Memory of Charlie Kirk – and Were Fired
Proposed U.S. Bill Would Allow Civil Suits Against Judges Who Release Repeat Violent Offenders
Penske Media Sues Google Over “AI Overviews,” Claiming It Uses Journalism Without Consent and Destroys Traffic
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
French Debt Downgrade Piles Pressure on Macron’s New Prime Minister
US and UK Near Tech, Nuclear and Whisky Deals Ahead of Trump Trip
One in Three Europeans Now Uses TikTok, According to the Chinese Tech Giant
Could AI Nursing Robots Help Healthcare Staffing Shortages?
NATO Deploys ‘Eastern Sentry’ After Russian Drones Violate Polish Airspace
Anesthesiologist Left Operation Mid-Surgery to Have Sex with Nurse
Tens of Thousands of Young Chinese Get Up Every Morning and Go to Work Where They Do Nothing
The New Life of Novak Djokovic
The German Owner of Politico Mathias Döpfner Eyes Further U.S. Media Expansion After Axel Springer Restructuring
Suspect Arrested: Utah Man in Custody for Charlie Kirk’s Fatal Shooting
In a politically motivated trial: Bolsonaro Sentenced to 27 Years for Plotting Coup After 2022 Defeat
German police raid AfD lawmaker’s offices in inquiry over Chinese payments
Turkish authorities seize leading broadcaster amid fraud and tax investigation
Volkswagen launches aggressive strategy to fend off Chinese challenge in Europe’s EV market
ChatGPT CEO signals policy to alert authorities over suicidal youth after teen’s death
The British legal mafia hit back: Banksy mural of judge beating protester is scrubbed from London court
Surpassing Musk: Larry Ellison becomes the richest man in the world
Embarrassment for Starmer: He fired the ambassador photographed on Epstein’s 'pedophile island'
Manhunt after 'skilled sniper' shot Charlie Kirk. Footage: Suspect running on rooftop during panic
Effective Protest Results: Nepal’s Prime Minister Resigns as Youth-Led Unrest Shakes the Nation
Qatari prime minister says Netanyahu ‘killed any hope’ for Israeli hostages
King Charles and Prince Harry Share First In-Person Moment in 19 Months
Starmer Establishes Economic ‘Budget Board’ to Centralise Policy and Rebuild Business Trust
France Erupts in Mass ‘Block Everything’ Protests on New PM’s First Day
Poland Shoots Down Russian Drones in Airspace Violation During Ukraine Attack
Brazilian police say ex-President Bolsonaro had planned to flee to Argentina seeking asylum
Trinidad Leader Applauds U.S. Naval Strike and Advocates Forceful Action Against Traffickers
Kim Jong Un Oversees Final Test of New High-Thrust Solid-Fuel Rocket Engine
Apple Introduces Ultra-Thin iPhone Air, Enhanced 17 Series and New Health-Focused Wearables
Macron Appoints Sébastien Lecornu as Prime Minister Amid Budget Crisis and Political Turmoil
Supreme Court temporarily allows Trump to pause billions in foreign aid
Charlie Sheen says his father, Martin Sheen, turned him in to the police: 'The greatest betrayal possible'
Vatican hosts first Catholic LGBTQ pilgrimage
×