U.K. economy nosedives 20.4% in one month due to COVID-19 lockdown measures | Global TV - Pan Pylas, Associated Press:
June 12, 2020 - "The British economy has seen nearly two decades worth of growth wiped out as a result of the lockdown measures put in place during the coronavirus pandemic. The Office for National Statistics said Friday that the economy shrank by a colossal 20.4% in April, the first full month that the country was under lockdown to contain the spread of the virus. All areas of the economy were hit during the month, in particular pubs, education, health and car sales.
"The monthly decline was unprecedented in scale and, adding the more modest — but still substantial — 5.8% decline in March, means the U.K. economy is around 25% smaller than it was in February. 'This startling fall in activity takes output in April back to around its level in July 2002,' said James Smith, research director at the Resolution Foundation.
"With much of the economy still mothballed in May and June, the U.K. is heading for one of its deepest recessions ever — the Organization for Economic Cooperation and Development has warned that the country is set to be the hardest-hit developed economy this year.
"Lockdown restrictions are slowly being eased, which should see the economy to start to pick up. On Monday, for example, nonessential shops, such as department stores and electronic retailers, can reopen if they can abide by social distancing requirements. But hopes that the bounceback in the economy will be as strong as the slide have receded given that many restrictions, such as on social contact, are set to remain in place.... People currently have to remain 2 metres (6-1/2 feet) apart, which is more than required in most countries and above the World Health Organaization’s minimum recommendation of staying one meter apart....
"The recovery is also set to be held back by the fact that many businesses just aren’t going to make it out of the slump and millions of workers face unemployment. People are also set to remain wary about going to shops or to commute so long as the virus remains a threat. Uncertainty over the U.K.’s trading relationship with the European Union at the start of 2021 is another factor that could keep a lid on ... the recovery....
"Companies have largely held off from cutting jobs during the lockdown as a result of the Job Retention Scheme, under which the government pays up to 80% of the salaries of workers retained, up to 2,500 pounds ($3,125) a month. Treasury chief Rishi Sunak has said that the scheme will close [in October]. That’s raised concerns that Britain will see a spike in unemployment then. In total, 8.9 million jobs have been furloughed under the scheme by 1.1 million employers at a cost to the government of 19.6 billion pounds ($25 billion). Even if 10% of those lose their jobs, it would increase unemployment substantially. In March, there were around 1.35 million people unemployed."
Read more: https://globalnews.ca/news/7058451/coronavirus-lockdown-britain-economy/
June 12, 2020 - "The British economy has seen nearly two decades worth of growth wiped out as a result of the lockdown measures put in place during the coronavirus pandemic. The Office for National Statistics said Friday that the economy shrank by a colossal 20.4% in April, the first full month that the country was under lockdown to contain the spread of the virus. All areas of the economy were hit during the month, in particular pubs, education, health and car sales.
"The monthly decline was unprecedented in scale and, adding the more modest — but still substantial — 5.8% decline in March, means the U.K. economy is around 25% smaller than it was in February. 'This startling fall in activity takes output in April back to around its level in July 2002,' said James Smith, research director at the Resolution Foundation.
"With much of the economy still mothballed in May and June, the U.K. is heading for one of its deepest recessions ever — the Organization for Economic Cooperation and Development has warned that the country is set to be the hardest-hit developed economy this year.
"Lockdown restrictions are slowly being eased, which should see the economy to start to pick up. On Monday, for example, nonessential shops, such as department stores and electronic retailers, can reopen if they can abide by social distancing requirements. But hopes that the bounceback in the economy will be as strong as the slide have receded given that many restrictions, such as on social contact, are set to remain in place.... People currently have to remain 2 metres (6-1/2 feet) apart, which is more than required in most countries and above the World Health Organaization’s minimum recommendation of staying one meter apart....
"The recovery is also set to be held back by the fact that many businesses just aren’t going to make it out of the slump and millions of workers face unemployment. People are also set to remain wary about going to shops or to commute so long as the virus remains a threat. Uncertainty over the U.K.’s trading relationship with the European Union at the start of 2021 is another factor that could keep a lid on ... the recovery....
"Companies have largely held off from cutting jobs during the lockdown as a result of the Job Retention Scheme, under which the government pays up to 80% of the salaries of workers retained, up to 2,500 pounds ($3,125) a month. Treasury chief Rishi Sunak has said that the scheme will close [in October]. That’s raised concerns that Britain will see a spike in unemployment then. In total, 8.9 million jobs have been furloughed under the scheme by 1.1 million employers at a cost to the government of 19.6 billion pounds ($25 billion). Even if 10% of those lose their jobs, it would increase unemployment substantially. In March, there were around 1.35 million people unemployed."
Read more: https://globalnews.ca/news/7058451/coronavirus-lockdown-britain-economy/
No comments:
Post a Comment