London’s economic system anticipated to undergo £44 billion hit resulting from Covid



ondon’s economic system is anticipated to undergo a £44 billion hit resulting from Covid and take till the summer season of 2022 earlier than it bounces again, consultants stated in the present day.

They stated the capital’s economic system, which is price about £460 billion, is anticipated to shrink by 9.5 per cent this yr however develop by 6.2 per cent subsequent yr and 6.9 per cent in 2022.

A brand new report from the GLA Economics unit at Metropolis Corridor stated there can be a 1.1 per cent discount in jobs this yr and a 4.6 per cent drop subsequent yr, adopted by a 3 per cent restoration in 2022.

This prompted calls from Mayor Sadiq Khan for the Authorities to increase the enterprise charges “vacation” and abandon plans to impose a “vacationer tax” by scrapping the VAT exemption for international consumers.

London’s unemployment fee has risen from 4.3 per cent on the finish of final yr to 6 per cent as much as September, however there are fears the statistics are failing to point out the complete influence of the pandemic.

Key sectors equivalent to tradition, leisure, retail and hospitality have been badly hit by the lockdowns and social distancing restrictions.

However sectors equivalent to monetary companies, actual property, skilled & technical actions and data & communications have been hit much less severely, with extra employees with the ability to make money working from home.

At the moment’s report says the arrival of a vaccine and the election of Joe Biden as US President, which ought to result in extra collaboration with Europe, supplied hope – however fears remained a couple of no-deal Brexit.

Mr Khan stated he feared that 350,000 Londoners might lose their jobs subsequent yr, which might be the most important fall in employment in additional than 20 years.

He urged Londoners to help the capital’s excessive streets and hospitality venues within the run-up to Christmas.

Mr Khan stated: “We had vastly optimistic information concerning the Covid-19 vaccine final week, however this information reveals the devastation this pandemic has and will but trigger with out extra authorities help.

“Many companies are nonetheless in peril of closing and lots of 1000’s of jobs are nonetheless in danger over the following few years.”

Richard Burge, chief govt of London Chamber of Commerce and Trade, stated: “An enormous lack of each vacationer and commuter income has seen central London’s companies hit tougher than elsewhere within the nation from Covid-19.

“The consequence is London having probably the most job losses of any area resulting from Covid-19. London Chamber of Commerce and Trade, and the Central London Alliance, are calling on the Authorities to offer focused help to central London to permit the UK’s financial engine to drive the nation’s restoration.”

Jasmine Whitbread, chief govt of foyer group London First, stated: “The Authorities should stand able to help these companies that can’t commerce usually, notably in tradition, leisure, retail and hospitality.

“Extending enterprise charges reduction by 2021 and restoring VAT-free searching for abroad guests will assist companies most in want. We additionally want a transparent and unambiguous message on the protection of public transport, so the job of kick beginning the economic system can start once more.” 

Shaun Bailey, the Tory mayoral candidate, stated the West Finish had been “destroyed” by the £15 congestion cost and accused Mr Khan of “flip-flopping” on curfews and lockdowns.

He stated: “Sadiq Khan promised he’d be the ‘most pro-business Mayor ever’ however the truth is below his management our companies have suffered greater than ever.”

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