State of the Economy: Re-Opening

Anne Marie Waters 

Tuesday 16th June 2020 

 

Queues wound through organised blocks yesterday as Britain’s retailers re-opened, and we got an idea of the changes we’ll see on the high street the post-coronavirus crisis.  After reading through the rules in place, I’m sure I won’t be the only one who isn’t looking forward to getting there.  (I’m not a big fan of queues!)

Retail giants including Marks and Spencer, Gap, and Primark opened all of their outlets in England, with others opening most or many of theirs.  Prime Minister Boris Johnson urged people to get to their high street and shop “with confidence”.

Thousands did just that, but not at numbers as high as might have been expected – footfall was up 38.8% from last week.  Numbers were reported as far lower than this time last year, proving it is going to take some time for the high street economy to recover to pre-coronarvirus life, if it ever does.

Shoppers are obliged to stand in long winding queues to stick to the requirement to remain 2 metres apart.  There are still no cafes or restaurants, something that will shorten the length of time shoppers spend on the high street.  We don’t yet know what restrictions will be in place when they re-open, but they will inevitably have a negative impact on trade.

Retail is facing a very difficult few months ahead.

Meanwhile, the number of people claiming work-related benefits rose 23% in May to 2.8 million.  According to economists, the lockdown is now being felt in the employment market, with the Office for National Statistics revealing that “early indicators for May show that the number of employees on payrolls were down over 600,000 compared with March.”

In America, fewers jobs were lost than expected in May.  The US regained 2.5 million jobs, leaving its unemployment figure at 13.3%.  Ending lockdown is at the discretion of individual states, and some have been opening their doors gradually over recent weeks. Regardless, this crisis has cost the US economy trillions of dollars (and its not over yet) while it could cost up to 82 trillion dollars globally.

So we continue to limp onwards, in to a new economic world.  The impact isn’t yet understood and will become clearer in the months ahead, particularly when the furlough scheme ends.  We don’t yet know either how recreation and entertainment will fare, or what off-putting or cost-raising regulations will be put in place.

In the UK, job vacancies plunged by 612,000 between March and May.  Around 9 million workers are currently furloughed and when October arrives, those 9 million will be looking for work in a far smaller economy.

But let’s not be pessimistic, and remember to focus on the positives; our shops are re-opening, which is a vast improvement on our situation a mere month or so ago.  It’s a slow and painful road ahead, but at least we seem to be on our way.

 

Anne Marie Waters

Leader

For Britain 

www.forbritain.uk

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