UK economy flatlines as GDP shows zero growth – what it means for your money

THE UK economy flatlined in April, official figures show.

Gross Domestic Product (GDP) was flat - 0.0% growth - during the month, following growth of 0.4% in March, according to the Office for National Statistics (ONS).

GDP is the measure of the economic output of companies and governmentsCredit: Getty

Today's figures mean the economy isn't growing or shrinking.

GDP is a measure of the economic output of companies, individuals and governments.

It's also a measure of how healthy and prosperous an economy is.

Economists had predicted that GDP would be flat in April, held down by weaker-than-usual retail sales over the Easter period.

Lindsay James, investment strategist at Quilter Investors, said the wet weather can also be thanked for the stall in growth.

She said: "Persistent rain has kept consumers from spending and caused economic growth to grind to a halt for the month with no growth registered.

"With rainfall in April 55% higher than average and the wettest April since 2012, it is perhaps no surprise to see the economy struggle as a result, with sectors such as retail, construction and pubs all severely impacted."

It comes after the economy grew by an estimated 0.6% in the first quarter of 2024, pulling the UK out of a small recession at the end of last year.

A healthy economy is one where GDP is growing but if it stalls or is falling, it's bad news for businesses and consumers.

What it means for your money

The latest figures show that the ongoing challenges linked to the cost of living challenges show no signs of going just yet away yet.

A healthy economy usually means lower inflation, rising employment, less poverty, and more money in your pocket.

Lower inflation is good because it means prices don't rise as fast, putting less financial pressure on households.

Plus, figures released yesterday revealed that the number of people not working due to long-term illness has reached the highest level on record.

Official figures show it rose by 55,000 to 2.83million in the three months to April.

This has led some experts to warn household budgets are still under immense pressure.

Alice Haine, personal finance analyst at Bestinvest, said: "Personal budgets have been battered by higher household costs over the past couple of years so even those enjoying some respite from easing inflation, falling energy prices and a rising pay packet are unlikely to be willing to splash the cash just yet."

How to protect your finances

There are ways you can keep your cash safe if you're worried about the UK's economic outlook.

Make sure you go through all your bank statements and accounts so you know what your income and outgoings are every month.

Of course, there are bills that you can't avoid paying - but that doesn't mean you can't cut back in other ways.

For example, you can save money by moving to a cheaper mobile phone tariff or by axing subscriptions you don't need like Netflix or Amazon Prime.

If you've got any outstanding debts, the worst thing to do is ignore them as it will only make your financial situation worse.

Stay on top of what you owe and always repay priority debts.

There are also plenty of organisations where you can seek debt advice for free.

These include:

National Debtline - 0808 808 4000
Step Change - 0800 138 1111
Citizens Advice - 0808 800 9060

You should also check what benefits you are eligible for as you might be able to claim without realising.

Entitledto's free calculator works out whether you qualify for various benefits, tax credits and Universal Credit.

If you don't want to register, consumer group moneysavingexpert.com and charity StepChange both have benefits tools powered by Entitledto's data that let you save your results without logging in.

There is also emergency funding available for struggling households, which is dished out by local councils.

The Household Support Fund is designed to help those on a low income or benefits cover the cost of food, energy and general living costs.

What help is available varies depending on where you live as each council sets it own eligibility criteria.