The latest figures from the Office for National Statistics (ONS) show that this monthly growth follows a fall of 0.1% in October and a rise of 0.1% in September – the latter of which was revised up from an initial estimate of a 0.1% decrease.
On a monthly basis, services and production rose by 0.3% and 1.1% respectively, whereas construction fell by 1.3% in November.
In the three months to November, real GDP experienced growth of 0.1%, having undergone no growth in the three months to October – revised up from a fall of 0.1%.
Positive news but uncertainty remains
These latest figures, combined with inflation that seems to be cooling and a base rate reduction in December, seem to paint a more positive picture. However, Alice Haine, personal finance analyst at Bestinvest by Evelyn Partners, warns that many are still taking a cautious approach.
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She said: “The UK economy returned to growth in November, with output coming in higher than expected at 0.3% following an unrevised 0.1% contraction in October. The uplift in activity comes despite the uncertainty caused by the late Autumn Budget, with the painful and protracted build-up to the fiscal event on 26 November mired by rampant speculation over potential tax changes. This left many businesses and households in limbo, delaying major spending decisions until they had clarity on which taxes would be targeted.
“Growth in November was largely driven by an uplift in the services and production sectors, which was partly attributed to the phased restart for manufacturing at Jaguar Land Rover following the cyber-attack in the autumn.
“The positive GDP data will deliver some relief for Chancellor Rachel Reeves at the start of the year, particularly as early indicators for December point to softer jobs data, subdued card spending and fragile business sentiment – though some of this can be attributed to the typical seasonal slowdown over the festive period.”
She added: “Employers and consumers are still bracing for more pain in the face of an ever-rising tax burden, however. Businesses, already contending with higher employment costs introduced at the 2024 Budget, notably the increase in the rate of employer National Insurance, now have fresh hikes in business rates and the minimum wage to contend with from 1 April this year. Add to that a cooling jobs market and geopolitical uncertainty, and many employers and households are approaching the new year with caution.
“A big threat to hopes of a further pick-up in activity in early 2026 comes from the struggling labour market, with signs that businesses are continuing to curtail hiring plans for the year ahead. A sharper-than-expected rise in unemployment could hit consumer spending hard, particularly if earnings continue to soften, and redundancies ramp up further. Many households are already under financial pressure, so a weakening jobs market, slowing pay growth and a higher tax burden present a challenging mix for household budgets.”
