The UK has now lost 6% of its entire economic output in its longest ever recession, official figures confirm.

The current slump is on a par with the 1980s recession which blighted former premier Margaret Thatcher's early years in power.

The figures showed the economy shrinking by 0.2% between July and September - a record sixth quarter in a row of decline - due to a weaker performance from the UK's powerhouse services firms.

This is better than the 0.3% previously estimated by the Office for National Statistics (ONS) but below the 0.1% hoped for by City experts after better recent construction data.

But the continued weakness among financial firms such as banks and insurers saw services output - which accounts for nearly three-quarters of the economy - down 0.2%.

The UK is expected to end its dreadful run with a return to growth in the final quarter of 2009 as consumers spend ahead of Christmas and bring forward other purchases to beat the VAT increase in January. But Capital Economics chief European economist Jonathan Loynes warned: "With household debt still very high, credit constrained and a fiscal squeeze looming, the economy still has a lot to contend with."

Previous quarters were also revised downwards by the ONS, adding to the depth of the slump. The economy shrank by a bigger than first thought 0.7% between April and June and by 0.9% in the third quarter of 2008. Between July and September, production output fell by 0.9% on the quarter, with a 0.2% decline registered by manufacturing firms.

But there were some bright spots in the figures which indicated a recovery in retail spending as well as a 0.7% output rise from businesses such as hotels and catering.

The figures also showed the first rise in total household spending since the opening three months of 2008 - up a modest 0.1% - suggesting that consumer caution is gradually beginning to thaw.

But the household savings ratio - the share of income put aside by families - also rose to an 11-year high of 8.6% during the third quarter of the year as households bunkered down to ride out the recession. The ratio stood at an upwardly revised 7.6% between April and June.

Ben Read, managing economist at the Centre for Economics and Business Research, said in the five years in the run-up to the recession, household savings averaged just 2.9%.

"Although this is good news in the longer term as an increase in savings is one of the key structural changes Britain needs to go through, the rise in the savings ratio is one of the key reasons why we expect growth to be relatively sluggish as the economy recovers," he added.