Britain’s economy avoided a recession in the third quarter after it expanded by 0.3% but the annual pace of growth was the slowest for nearly 10 years as Brexit uncertainty depressed business activity.

Official figures showed the UK returned to growth between July and September after a dip of 0.2% in the three months to the end of June. A technical recession is defined by two successive quarters of negative growth.

There were fears that Brexit uncertainty might have pushed the economy into further negative growth but Britain’s services sector – which encompasses a range of industries from film and TV production to banking and the high street – performed strongly enough to push the UK into positive territory.

The shadow chancellor, John McDonnell, said the sight of ministers celebrating 0.1% growth over the last six months was “a sign of how low their hopes and expectations for our economy are”. There was also a downward trajectory across the quarter after an increase in growth in July turned negative in August and September, pulling growth down to its lowest annualised rate, at 1%, since the first quarter of 2010.

The Liberal Democrat’s Treasury spokesman, Ed Davey, said the government was to blame for an “anaemic” economy.

“Today’s growth figures are anything but a cause for celebration,” he said.

The chancellor, Sajid Javid, said the figures were a “welcome sign” that the “fundamentals of the UK economy are strong”.

Britain’s attraction as a centre for film and TV production was one of the main drivers of growth, as it has been over the past two years, the Office for National Statistics (ONS) said. The contribution of film and TV production to the figures underlined the success of the entertainment industry recently, with more than 200 films and 120 high-end TV shows made in Britain last year – at a cost of £3.1bn. The trend is set to continue, with Netflix alone committing $500m (£400m) to making more than 50 TV shows and films in the UK over the next year.

Elsewhere in the figures, spending on IT accelerated as firms upgraded their computer systems and improved online services to their customers.

Exports surged 5.2% quarter on quarter while imports only increased by 0.8% to leave net trade up 1.2%. However, the ONS said it was concerned about the accuracy of the data after “external evidence” pointed to “weaker export growth than shown in the official estimates”.

Building companies benefited from a rise in public sector housebuilding and a mild recovery in new orders for commercial work. Overall the construction industry grew by 0.6% in the three months to September.

Business investment was the main drag on growth during the quarter after manufacturers cut back on upgrades to factories and purchases of new equipment.

Seamus Nevin, the chief economist at Make UK, the manufacturers’ organisation, said firms continued to lay off workers in response to Brexit uncertainty and a slowing global economy.

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“While the economy overall has seen a slight pick-up, it has been led by the services industry with only the bounceback in car manufacturing offering some positive impact following April shutdowns. Compounding this is the seventh consecutive month of job losses, with the rate of decline at its fastest for the past decade,” he said.

Ian Stewart, chief economist at the consultancy and accounting group Deloitte, said it was a “respectable performance”, given recent economic pressure but he was less positive about the overall outlook.

He said: “This is a pretty respectable performance, given the headwinds from the global slowdown, protectionism and Brexit uncertainties. But with businesses focused on cutting costs, wages and jobs are likely to come under pressure. The outlook for 2020 is for more subpar growth.”



