As a result economists are calling on the Government to slash taxes and regulation in a bid to kickstart growth.
Professor Len Shackleton at the Institute of Economic Affairs said the key is cutting taxes to support jobs.
“Short-term measures should include reducing employment costs – so suspend employers’ national insurance, scrap the apprenticeship levy, and change rules on pension auto enrolment to match the national living wage threshold.”
The Adam Smith Institute proposes letting cafes and pubs use public parks as beer gardens to enable more socially distanced consumption, as well as easing Sunday trading rules.
The Taxpayers’ Alliance called for cuts to capital gains tax and a boost to the annual investment allowance, to encourage companies to invest and grow.
Gerard Lyons, former economic advisor to Mr Johnson and now at Netwealth, said low interest rates meant the Government could keep borrowing rather than either cutting spending or raising taxes.
The Institute of Directors called for an expansion of research and development tax credits, national insurance reliefs and a higher annual investment allowance.
“To help spur business investment, the Government must make good on its commitment to broaden existing tax reliefs for research and development,” said the business group’s chief economist, Tej Parikh.
“Waiting until later in the year to act will risk more businesses and jobs will be lost.”