aviation and consumer industries dealt crushing blow

Linda J. Dodson

Those companies that remain face crippling social distancing measures that will make it enormously difficult for many of them to survive.

In his recent ‘mini-Budget’ Chancellor Rishi Sunak announced measures to help the hospitality sector, including cutting the VAT rate to 5pc and offering a 50pc discount for diners to spur demand, while the two-metre rule has also been partially relaxed.

However industry experts have warned that this may not be enough. Helen Dickinson, chief executive of the British Retail Consortium, said: “The recent redundancies in fashion and other retail sectors may just be the tip of the iceberg. Many perfectly viable businesses will struggle because the lockdown forced them to close and reduced their income to zero.

“The Government must do more; retailers need support with rent so that they are not shouldered with unpayable debts. Without this, hundreds of thousands of jobs and high streets across the country will hang in the balance.”

Manufacturing, automotive, construction and service industries struggle

No corner of the workforce has been spared from the fallout, and the manufacturing, automotive, construction and non-financial service industries have all also seen their share of job cuts.

Centrica, the owner of British gas, has declared it will axe some 5,000 positions across the country, the third most of any company to have declared cuts in the UK.

Other major names include Rolls-Royce (3,000 cuts in the UK), Travis Perkins (2,500), DHL (2,200) and Jaguar Land Rover (1,100).

Business activity in these sectors plunged across April and May as manufacturing plants shut down, automotive factories closed their doors, construction site workers downed tools and real-estate agents were unable to offer house viewings. 

The closely watched purchasing managers’ index (PMI) survey of companies came in at just 13.4 for the service industry and 32.6 for manufacturing – any score below 50 signals a contraction. These figures have since rebounded somewhat, but the recovery remains slow.

Source Article

Next Post

Mortgage costs hit ‘record low’ but drag savings rates below 1pc for first time

Mortgage rates have fallen to a record low but this has caused further pain for savers, who have seen their average returns fall below 1pc. The Bank of England made two emergency cuts to the Bank Rate at the start of the coronavirus pandemic and this caused mortgage borrowing costs […]