Cities feel the strain as workers defy PM’s call to return to offices

Linda J. Dodson

Analysts warned city economies were suffering from the home working boom. Allan Monks, UK economist at JP Morgan, said the impact of remote working on face-to-face services was a “major concern” for the economy.

“Many people are no longer travelling to major cities, where there are many services that feed off of office-based activity,” he said. “This doesn’t just include restaurants and bars, but a broader range of businesses including gyms, dry cleaners, hairdressers, taxis and retail establishments.”

Mr Monks said some spending would have been transferred to the suburbs but that would likely bring a smaller boost to overall output. City centre consumer services are suffering a glacial L-shaped rebound, he warned.

Rishi Sunak, the Chancellor, has blamed the economy’s reliance on this “social consumption” for the UK being one of the hardest hit by the pandemic.

GDP plunged 22pc in a dire first half of 2020, a hit bigger than other major economies, except Spain. The Prime Minister changed the work-from-home advice from Aug 1, encouraging firms to bring employees back to offices if it was safe to do so.

But many businesses are waiting much longer before bringing workers back, piling the pressure on cities. Almost half of Britons worked from home in April.

Source Article

Next Post

Legal threat over ‘unfair’ Brexit deal on customs

Trade bodies have threatened legal action against the Government’s new Brexit customs system, claiming it will unfairly distort competition. In a heated meeting of HM Revenue and Customs’s expert customs panel, industry groups said the new Trader Support Service, which will enable the Government effectively to act as a customs agent […]