The UK economy had zero growth between July and September, revised official figures display.

The revised data comes after a series of disappointing figures including expense boost rising at its fastest pace for eight months and the economy unexpectedly shrinking in October.

One of the UK’s leading business groups, the CBI, said its latest business survey suggested “the economy is headed for the worst of all worlds”.

Chancellor Rachel Reeves said the test to fix the economy “after 15 years of neglect is huge”, while shadow chancellor Mel Stride said Monday’s figures showed “growth has tanked on Labour’s watch”.

The revised figure will be a blow to the government which has made boosting the economy its top priority.

Labour has promised to deliver the highest sustained market advancement in the G7 throng of the globe’s richest nations.

Businesses have already warned that measures announced in October’s distribution including a rise in employer national insurance contributions (NICs) and a higher minimum wage could push them into cutting jobs and raising prices.

These distribution changes arrive into result in April. But Stride said the latest figures from the three months before the October distribution signal “the warning lights are flashing” on how the economy will fare into 2025.

Reeves said Labour’s distribution would “deliver sustainable long-term growth, putting more money in people’s pockets through increased resource and relentless reform.”

Liberal Democrat treasury spokesperson, Daisy Cooper called on the government to reverse the national insurance responsibility hike on tiny businesses and scrap the business rates structure.

The CBI, which claims to represent 170,000 firms, said its survey based on responses of 899 firms between 25 November and 12 December, found private sector businesses across all industries expected a “steep decline in activity” in the first three months in 2025.

“Expectations are now at their weakest in over two years,” said Alpesh Paleja, the CBI’s interim deputy chief economist.

A divide survey by the British Retail Consortium, which represents UK retailers ranging from Marks and Spencer to Tesco, suggested a “January spending squeeze on the horizon” for consumers.

It said “community confidence in the state of the economy took a nosedive” this month, according to its customer sentiment survey.

“With sales growth unable to keep pace, retailers will have no selection but to raise prices or cut costs – closing stores and freezing recruitment,” said Helen Dickinson, chief executive of the BRC.

Mick Dore, general manager of the Alexander pub in Wimbledon, said its costs would rise in April due to the rise in national insurance contributions it makes for its 50 to 60 staff.

“All of December we’ve been crazy busy with loads and loads of work parties,” he told BBC Breakfast. “There are expense implications going forward and we have to have a excellent Christmas to insulate ourselves against that.”

But he said he was optimistic about business next year.

“I generally ponder as a whole we are going to be ok. I’ve been around a long period now and each period they’ve told me the complete is nigh it never has been.”

Paul Dales, chief economist at pool Economics, said there was “no question that some business and households put spending and resource on hold around the distribution”. But he said it was “too soon to view any genuine result of Labour policies”.

He said it would be a matter of period before the drag from higher profit rates gave way to a boost from lower rates but he expected to view an advancement in the second half of next year.

Simon French, chief economist at Panmure Liberum said the revised figures were consistent “with a lot of other indicators we’ve seen since the July general election that’ve shown a setback of momentum in the economy”.

He said there was a question over whether this was a typical slowdown as seen after previous general elections which later picked up or “whether this is something more problematic teeing up a decline next year”.

The lender of England voted to hold profit rates on Thursday, stating it thought the UK economy had performed worse than expected, with no growth at all between October and December.

The UK economy is measured by gross domestic product – a assess of all the economic activity of companies, governments and people in the country.

The ONS puts out initial estimates on the UK’s economic act and revises them once it receives more data.

On Monday it also revised down growth figures for April to June to 0.4% from 0.5%.

It said the economy was weaker than initially estimated as bars and restaurants, legal firms and advertising firms performed less well.

“Real household disposable profits per head showed no growth,” ONS director of economic statistics Liz McKeown said.