Britons Learn to Live With Lockdown as Economy Builds Resilience
(Bloomberg) -- U.K. economic activity during the current Covid lockdown has been considerably less depressed than in the first wave of restrictions, indicating that businesses and households are adapting to pandemic life.
Fewer businesses are temporarily closed and more people are operating from their usual workplace than during the lockdown that began in March of last year, according to the Office for National Statistics. Spending, travel and road traffic are all higher and fewer employees have been furloughed.
The data published Friday provides evidence of growing resilience in the U.K. economy that could help propel its recovery from the deepest slump in over 300 years. Output shrank less than expected in January and economists project a 3.5% contraction in the first quarter, compared with an almost 19% plunge in the second quarter of 2020 when restrictions were at their peak.
Adaptations made by firms mean around 55% of arts, entertainment and recreation and accommodation and food businesses were temporarily closed in January, when England’s third lockdown began, compared with over 80% in the first one. In construction, just 4% paused trading this time, against almost a third last spring.
Around 45% of the workforce are operating from their usual place of employment, up from 36%.
Spending is also holding up better. It dipped 28% below pre-pandemic levels in early 2021, compared with a 56% drop during the first lockdown, according to Revolut data analysed by the ONS. Shoppers are increasingly buying online, indicating a possible long-term culture shift.
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