Jubilee Joy Ends in Economic Hangover, GDP Figures Show; ROYAL PARTY AND OLYMPICS SKEW GROWTH STATISTICS
Byline: CHRIS KELSEY firstname.lastname@example.org
THE Diamond Jubilee and the London 2012 Olympic and Paralympic Games were probably responsible for "a significant part of the volatility of GDP growth" last year, according to a study by the Office for National Statistics (ONS).
However, the authors of the report caution that this "does not change the overall picture of an economy that was growing slowly at best during 2012."
In a detailed analysis, the ONS says that the Diamond Jubilee "could have reduced the level of UK GDP in the second quarter of 2012 by 0.3 to 0.4 percentage points."
But it warns that it is impossible to estimate the exact effect of the June celebration, and the figures "should be viewed as the broad order of magnitude rather than anything more precise".
The authors go on to say that the impact of the Games is "more difficult to determine, and even the direction of the impact is uncertain in some areas."
But they add that there was a 0.2 percentage points boost to GDP in the third quarter of 2013 from the effect of ticket sales.
The report shows that output fell by 1.4% between May and June 2012 in the services sector and by 2.4% in the industrial sector. In both cases, output returned to the May level, or above, in July.
If the whole of the fall in output between May and June was due to the Diamond Jubilee, the authors say, GDP would have been 0.5 percentage points higher in the second quarter in the absence of the extra holiday than shown in the published figures.
But they caution that the level of output in May could have been swollen by the absence of the usual late-May bank holiday. The impact of the Diamond Jubilee is therefore likely to have been around 0.3 to 0.4% of GDP.
During June, the output of the services sector (on a seasonally-adjusted basis) decreased by 1.4% compared with May. The fall was wide-spread across service industries, with the exception of government and other services, which grew by 0.2% in the month.
Output in the transport, storage and communication sector fell by 3.3%, and the distribution, hotels and restaurants, and business services and finance sectors also saw contractions, falling by 1. …