Andy Burnham has been given some good news (Image: Getty)
Britain’s economy has grown at its fastest pace in two years fuelled by growth in the service sector according to new data. Numbers released by the Office for National Statistics (ONS) show economic growth increased to 0.7% in the period of July to September.
It will be seen as welcome news by Andy Burnham and his new Chancellor John Healey, having outpaced growth in the previous two periods. Between January to March the UK economy grew 0.6% and the second quarter of last year it was 0.5%.
Growth in the UK has been slow for nearly two decades since the financial crisis of 2008. Further trouble came in the form of the Covid pandemic and then price spikes caused by Russia’s illegal invasion of Ukraine.
Mr Burnham welcomed the news saying: “Despite a year where events around the world have pushed up costs here at home, our economy is growing, bringing hope for the future.
“Our job now is to keep focused on what matters to people: bringing down bills, creating good jobs, helping high streets thrive and backing businesses to grow.
“There is more to do, but we have a clear direction.
“Giving people breathing space now while making the long-term changes needed to deliver good growth in every part of Britain.”
Chancellor John Healey said in response to the latest UK growth data: “The Middle East conflict has hit growth worldwide, yet Britain is showing standout resilience.
“Our UK economy is growing at the fastest rate in almost 10 years, outside the pandemic.
“We are backing UK investment, innovation and fast growth firms. I want to bring back confidence in Britain.”
British families have continued to feel the squeeze on prices since the start of the Iran war which has sent energy and fuel prices rising.
Andy Burnham Gets Some Good News as UK Economy Grows Fastest in 2 Years
An Essay on Britain’s Economic Recovery, Political Leadership and the Challenges Ahead
The British economy has received an encouraging boost following the latest economic figures showing that the country experienced its strongest quarterly growth in more than two years. The news is particularly welcome for Prime Minister Andy Burnham and Chancellor John Healey, who have faced considerable pressure to demonstrate that their economic policies can deliver tangible improvements.
According to figures released by the Office for National Statistics (ONS) on 12 November 2026, Britain’s gross domestic product (GDP) increased by 0.7% between July and September 2026. This represents an improvement on the 0.5% growth recorded in the second quarter and marks the strongest quarterly expansion since the beginning of 2024.
The figures provide some positive evidence that the British economy has demonstrated resilience despite international instability, higher energy costs and continuing pressure on businesses and households.
However, while the latest results offer encouragement to the government, they do not necessarily mean that Britain’s economic problems have been resolved. The challenge now is to turn stronger economic growth into better living standards, higher wages, more employment opportunities and greater financial security for ordinary families.
1. Stronger Economic Growth Brings Political Relief
Economic growth is one of the most important measures by which governments are judged. When GDP increases, it generally indicates that businesses are producing more goods and services and that economic activity is expanding.
For Andy Burnham, the latest figures provide an opportunity to defend his government’s economic direction.
The increase to 0.7% is significant because Britain has experienced a prolonged period of economic uncertainty. Businesses have faced rising operating costs, households have struggled with expensive energy bills and investors have had to navigate an unpredictable international environment.
The latest figures suggest that economic activity has remained stronger than some earlier concerns might have indicated.
Burnham welcomed the figures, describing them as encouraging news for the country. He also emphasised that the government’s priorities must remain focused on reducing household bills, creating good jobs, supporting businesses and helping high streets recover.
Nevertheless, one strong quarterly performance should not automatically be interpreted as proof of long-term economic success. The government will need to demonstrate that growth can be maintained over subsequent quarters.
2. Artificial Intelligence Helps Drive Economic Expansion
One of the most interesting features of the latest economic figures is the contribution made by technology and artificial intelligence.
According to the ONS, the services sector was the main driver of growth, expanding by 0.9% during the three months to September. Computer programming, consultancy and related activities made a particularly important contribution.
Businesses connected with cloud computing and artificial intelligence have benefited from increased demand as companies invest in digital technologies to improve productivity and competitiveness.
This development illustrates how Britain’s economic future may increasingly depend on its ability to embrace technological change.
Artificial intelligence has the potential to transform many industries, including finance, healthcare, manufacturing, education and professional services. British businesses that successfully adopt these technologies could become more productive, attract international investment and create new employment opportunities.
However, technological development also creates challenges. Some traditional jobs may disappear, while workers will need new skills to remain competitive.
The government therefore has an important responsibility to invest in education, digital infrastructure and professional training.
It should also ensure that the benefits of technological progress are shared across the country rather than concentrated in London and a small number of wealthy regions.
3. Britain Demonstrates Resilience Despite International Challenges
The latest economic performance is particularly noteworthy because it occurred against a difficult international background.
The conflict in the Middle East has contributed to higher energy prices and uncertainty in international markets. These developments have increased costs for businesses and created additional financial pressure for households.
Despite these challenges, Britain’s economy expanded by 0.7% during the third quarter.
Reuters reported that Britain recorded the second-fastest quarterly growth among G7 economies with available figures, behind the United States.
The figures also showed that annual GDP growth reached 1.9%, demonstrating an improvement in overall economic activity.
This performance suggests that the British economy has maintained a degree of resilience despite external economic shocks.
Nevertheless, resilience should not be confused with complete economic security.
Higher energy costs can gradually affect production, transport, food prices and household budgets. If these pressures continue, they could weaken consumer confidence and reduce spending.
The government must therefore remain prepared for further international economic uncertainty.
4. The Challenges Facing British Households
Although stronger GDP figures are encouraging, many British families may not immediately feel the benefits.
Economic growth does not automatically mean that people have more money available at the end of each month.
Households continue to face pressure from housing costs, food prices, energy bills and borrowing expenses. For people on low or middle incomes, even relatively small increases in everyday costs can create serious financial difficulties.
This creates an important challenge for Burnham’s government.
The administration must ensure that economic growth translates into improvements in ordinary people’s lives.
Reducing inflation, encouraging wage growth and expanding employment opportunities should therefore remain central priorities.
The government must also address the housing crisis, improve access to affordable childcare and strengthen public services.
A growing economy is valuable, but its success should ultimately be judged by whether citizens experience a meaningful improvement in their standard of living.
5. Construction and Investment Remain Areas of Concern
Despite the positive headline figures, the economic data also contain some less encouraging developments.
The construction sector contracted by 0.7% in the three months to September. This is particularly concerning because construction plays an important role in housing development, infrastructure investment and employment.
New private housing activity also remains under pressure.
Britain urgently needs more affordable homes, better transport infrastructure and investment in regional development. Weakness in construction could make these ambitions more difficult to achieve.
Business investment is another area requiring attention. Reuters reported that business investment increased by just 0.4% during the third quarter, below economists’ expectations.
This suggests that some businesses remain cautious about committing money to expansion despite stronger overall economic activity.
The government must therefore create conditions that encourage companies to invest, innovate and employ more people.
This could involve improving infrastructure, simplifying unnecessary regulations, supporting research and development and providing greater certainty about long-term economic policy.
6. The Bank of England and the Risk of Higher Interest Rates
Another important complication is the relationship between economic growth and inflation.
Stronger economic activity is generally positive, but if demand grows too quickly while supply remains constrained, inflationary pressures can increase.
The Bank of England must therefore consider whether stronger growth could make it more difficult to bring inflation under control.
Reuters reported that the Bank had raised its forecast for British economic growth in 2026 to 1.6%. However, financial markets were also anticipating the possibility of further interest-rate increases.
Higher interest rates can help control inflation, but they also increase borrowing costs for households and businesses.
Mortgage holders may face more expensive repayments, while companies may delay investment because financing becomes more costly.
This creates a difficult balancing act for economic policymakers.
The government must encourage sustainable growth while respecting the independence of the Bank of England and avoiding policies that could intensify inflation.
7. Can Andy Burnham Turn Economic Growth into Long-Term Success?
The latest figures provide Burnham with an opportunity to demonstrate that his government can deliver economic progress. However, maintaining that progress will require more than celebrating positive statistics.
Britain needs a long-term economic strategy based on productivity, innovation, investment and regional development.
One important priority should be reducing the economic divide between London and other parts of the country. Cities such as Manchester, Liverpool, Birmingham, Leeds and Newcastle have considerable potential to attract investment and create skilled employment.
Burnham has previously emphasised regional development and the importance of devolving power away from Westminster. Such an approach could help local authorities respond more effectively to their communities’ economic needs.
However, decentralisation must be accompanied by adequate funding, clear responsibilities and effective accountability.
The government should also encourage cooperation between universities, technology companies and manufacturers to ensure that Britain remains competitive in emerging industries.
Most importantly, economic policy must remain consistent. Businesses need confidence that government priorities will not change dramatically every time political circumstances become difficult.
Conclusion
The latest economic figures represent an encouraging development for Andy Burnham and the British government. With GDP increasing by 0.7% in the third quarter of 2026, Britain has recorded its strongest quarterly economic growth since early 2024.
The expansion of technology services, particularly activities associated with artificial intelligence and computer programming, has provided an important contribution to this performance.
However, significant challenges remain. Construction activity is declining, business investment remains relatively weak and households continue to face pressure from living costs and higher energy prices.
The government must therefore avoid becoming complacent about one positive economic announcement.
The real test of Burnham’s leadership will be whether he can maintain economic growth, attract investment, create better-paid jobs and improve living standards across every region of Britain.
Ultimately, economic success should not simply be measured through GDP statistics or favourable headlines. It should be measured through the everyday experiences of ordinary people: whether they can afford their homes, pay their bills, find secure employment and provide better opportunities for their children.
Britain has received a welcome economic boost, but the real work begins now. Andy Burnham has an opportunity to turn encouraging figures into lasting economic progress. Whether his government can deliver that ambition will be determined not by today’s statistics, but by the prosperity and security that British families experience in the years ahead.