Midlands is biggest victim of Covid-19 lockdown

Linda J. Dodson

Luxury carmaker Rolls-Royce is the only manufacturer to have resumed production so far, although the industry is gradually coming back to life with Aston Martin set to reopen its factory in South Wales on Tuesday. Ford and BMW are both bringing their Europan plants back online. 

Yorkshire and the Humber and the North West have suffered the next-steepest declines, with their economies cratering 37pc each.

By contrast, London is thought to have slumped by a smaller 28pc – still a drop unprecedented in modern times – as the lockdown suits its more services-based economy where staff are able to work from home.

Daryn Park, a CEBR economist, said: “Industries tend to cluster together, and hence certain regions are likely to weather the lockdown period better than others.

“London has a high concentration of financial and professional services that, to a greater extent, can continue operating under lockdown.

“The West Midlands in contrast has a high concentration of manufacturing which, as a result of a fall in demand for consumer products, has seen a subsequent fall in demand for manufacturing outputs, negatively affecting their economy.”

Make UK, the manufacturing lobby group, warned that a swift recovery is unlikely in  the Midlands and called on ministers for more support as Mr Johnson prepares to set out plans to unlock the economy.  

A spokesman said: “Given the impact on the manufacturing supply chain which is likely to see disruption for some time to come, there will be a need for the Government to be creative and flexible in its approach to supporting the sector in the same way as companies.

“Any national recovery plan once we are beyond the immediate crisis must have a critical emphasis on boosting trade and upskilling the workforce, especially in digital skills which will be central to industry from now on.”

Economists have meanwhile warned that maintaining social distancing for a prolonged period could delay the recovery with a long hit to retail and a serious blow to leisure industries for the rest of this year.

Paul Dales, chief UK economist at Capital Economics, said the recession risks turning from a ‘tick-shaped’ slump with a gradual recovery into a deeper ‘U-shaped’ crash with dire consequences for growth and jobs.

Source Article

Next Post

Philippines' Duterte apologizes to tycoons he threatened to jail

MANILA — A “humbled” President Rodrigo Duterte apologized to business tycoons he once threatened to jail after saying he welcomed their response to the coronavirus crisis. The Philippine leader, who has had an antagonistic relationship with the country’s commercial elite, said during a televised address late on Monday that he […]

You May Like