State of the Economy: Better

Anne Marie Waters 

Tuesday 23rd June 2020

 

So, we’ve got the first week of post-lockdown high street trading under our belt, but how did it go?

A mixed bag.  The economy is gaining momentum, according to the Telegraph, and we’ve had “a record surge in activity”.  Manufacturers led the biggest growth spurt since 1998 as lockdown restrictions were eased and high street businesses reopened.

Boris Johnson today announced further easing and as expected, pubs, cafes, cinemas and other recreational business can reopen in early July.

With the hospitality industry also on its way back, businesses are doing their best to prepare for “the new normal”.  Social distancing rules will inevitably alter this industry, particularly in the early days, in ways that could be enormously detrimental economically.  A B&B owner told the BBC “I’m going to be really interested to see how much I’m going to be allowed to achieve by myself, when I have to switch from cooking to cleaning, for instance.  I’ve heard that breakfasts may have to be delivered to rooms, which isn’t practical for me as a one-person business.  I also can’t afford to buy room service trays.”

Space will be another issue, particularly in dining rooms; the further from each other that diners are required to sit, the less space is available and customer numbers are cut.  Buffet breakfasts will not be allowed, putting extra strain on staffing.

The newly announced social distancing requirement of 1 metre means strain on space in pubs as well.  Small pubs i.e some of our oldest and most beautiful, may struggle.  Simon Daws, a pub owner in Gloucestershire, said “If the distance is 1m then pubs with generous garden areas can make a go of it”.  This begs the question, what if a pub doesn’t have a generous garden area?

Daws later added “We will be walking a tightrope. We are relying on sunny weather to make the new system work.”

Uncertainty is playing a major part in the country’s business woes, and firms are unsure how to prepare because rules are perceived as mixed and confused.

Hair salons may reopen in July but they are unclear as to how they will conduct their business.  One salon owner said “We’ve taken no bookings yet but once we have some clarity I hope to book appointments in for the first week.  We don’t know what grade facemasks we’ve got to have or what kind of gloves we need, given we’re washing our hands constantly in normal times.  We have some cloth facemasks but they may not fit in with the guidelines.”

Salons will have to cut their client numbers significantly and work longer hours, meaning less income and higher wages.

It’s not all bad news though so let’s end on a high.  The shops are back open and people are visiting them again.  Small businesses have had a boost and the end of the lockdown is in sight.  (Corner shops did well under the lockdown.  Between mid-May and mid-June, their sales rose by 69%.  But patterns there are beginning to return to normal as 19 million more supermarket trips were made in June than in May.)  There’s been a hoped-for surge in economic activity, and a post-Brexit trade deal with Japan is still on the cards (though time is short).

For now, once again, we are unsure what faces us.  But when things are moving in the right direction, it’s best to cautiously keep going.

 

Anne Marie Waters

Leader 

For Britain 

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