Tech sector growth is masking weakness in manufacturing, production and construction

Growth Commission Chairman Shanker Singham has issued the following response to the GDP figures for the three months to July 2026 that have been issued this morning:

“With the usual caveat that these are GDP not GDP per capita numbers – which will be more restrained with population increase (most of which is net migration) – any growth is welcome.

“But if the new Prime Minister wants to reindustrialise, then he should be concerned that it is again the tech sector (and related computing services and consultancy) whose growth is masking weakness in manufacturing, production and construction which have been weak for some time now.

“This is not surprising as the manufacturing and production sectors are most directly affected by the UK’s poor goods regulation and high energy costs. It is also not surprising that some 71% of businesses with more than ten employees are concerned about rising energy prices.

“We should also be concerned about signs of retail weakness in August. This has to be set against the hike in UK interest payments on its spiralling debt, cutting out any headroom for the Chancellor.

“The skew towards services and away from manufacturing and production, which has been a theme in the UK for some time, is if anything accelerating. The Prime Minister should focus on ensuring that the Government does nothing to damage the tech sector, while at the same time removing the regulatory burdens on manufacturing and production.”