A new report has revealed the daily impact of the coronavirus lockdown on the East of England’s economy and highlighted which sectors are performing the strongest and protecting the UK from even greater damage.
New report reveals daily economic impact of coronavirus lockdown on East of England
According to UK Powerhouse, a report by Irwin Mitchell and the Centre for Economic and Business Research (Cebr), GVA* (the value of goods and services produced) is estimated to be falling in the region by 36%, or £241m a day during the lockdown.
The report says the region has a significant GVA from the education sector at £43m per day pre-COVID, boosted by the University of Cambridge, the University of East Anglia and Anglia Ruskin University - all of which are maintaining some sort of virtual learning and maintaining a proportion of the sector’s output. The sector, however, is estimated to have a loss in GVA of 46% per day, equivalent to £20m.
The East of England has also faced a significant fall in GVA from wholesale retail activities. This is due to the fact that individuals cannot go to out to shops and are relying on online deliveries, which is subduing total expenditure.
GVA loss per day across the UK regions
Source: ONS, Labour Force Survey, BRES, Cber analysis
Despite claiming that the UK economy overall is losing £2.7 billion a day in absolute terms, the report states that some sectors such as agricultural, forestry and fishing, along with the information and communication sector, have remained strong with a relatively low daily GVA fall of 14% and 2% respectively.
It adds that a national 1.3% rise in the share of the workforce mainly working from home over the past five years puts the UK economy in a more resilient position in terms of the share of people able to work remotely during the lockdown.
Victoria Brackett, CEO of Irwin Mitchell’s Business Services division, said: “Although in absolute terms the East of England’s economy is losing almost £250m a day, in relative terms it has fared better than many other regions in the UK.
“Compared to other regions in the UK, the region is at an advantage when it comes to with working from home and mitigating the impact of the lockdown. The proportion of people working from home in the East of England is the fourth highest out of the 12 UK constituent nations and regions following an increase of 1.3% which takes the total to 5.5%.”
To calculate the UK’s impact (and the regions), Cebr calculated the pre-COVID GVA per day. To assess the lockdown’s impact, it estimated demand and supply-side impacts for each of the sectors below – these impacts include elements such as ability to work remotely, proportion of workers off sick, actual demand for the products and supply-chain disruptions that the lockdown has caused. As such, each sector listed below has an estimate of the impact of the lockdown and is presented in absolute terms and a percentage loss.