I had not expected London’s economy to have done nearly as well in 2020 as the most recent output (GDP) figures show (left hand panel of the chart). All the more up-to-date data — for example on furloughs and mobility — have tended to point to a much less robust picture. What could explain this discrepancy?
The answer is the same as it normally is: the aggregate figures hide important detail*. Large parts of the London economy have in fact rebounded remarkably well. This is the case for financial, professional and ICT services (right hand panel of the chart). …
Since the pandemic began in 2020, the impact on people’s financial situation, on average, has been a lot less severe than originally feared. A lot of this has to do with government support, which has buffered the economic shock for individuals and businesses. The situation is of course different for every household (see e.g., February 8 here). However, even at its highest, only around 23% of people said, in ONS’s weekly Opinions and Lifestyle Survey, that “My household finances are being affected” by COVID-19.
By July 2021, that figure had come down to an average of 15% for all people…
With “freedom day” finally upon us, I wanted to see whether it showed up in Google’s COVID-19 Community Mobility Reports. Not surprisingly, the answer is “yes”, even though the start of school holidays sometime that week in most places in England will have created additional perturbations that make it hard to interpret. However, looking at the data does show just how much London lags behind every other region in its recovery.
Before I get into more commentary, let me explain a few things about the data shown. In order to better identify any impact that changes to social distancing and…
This blog has a meta-message: please, please, please, when making decisions for your organisation (or country), do not extrapolate from yourself. I might write a whole blog one day about the situations in which such extrapolation has resulted in huge wasted effort, or worse. However, today’s blog is about remote work.
Most of you reading this will be professionals who shifted to home working as the pandemic took hold. Please remember that you are in the minority. According to McKinsey Global Institute’s analysis, perhaps 20–25% of jobs in developed economies can be reasonably done remotely for 3–5 days per week…
Last week, the UK’s Prime Minister, Boris Johnson, gave a speech on one of the government’s top policy priorities: levelling up. It had a welcome recognition of the importance of human capital (which I’ve written about previously). It also highlighted the potential for less prosperous places to house more people and businesses enabled by digital connections. If more than a quarter of UK jobs could be done remotely (the highest proportion among peer countries), maybe more of them could be in these areas? …
The UK’s annual inflation rate in June 2021— the percentage increase in the price of a basket of goods and services since June 2020 — has been received with some trepidation. Having mostly oscillated between zero and 1.0% since the COVID-19 pandemic began, inflation rates above (the Bank of England’s target of) 2% in May and June 2021 have caught commentators’ attention. Indeed, the increase between March and June, by almost 2 percentage points, is sharp by historical standards. A similar increase was last recorded at the end of 2009, as the economy recovered from the previous crisis. However, at…
As “freedom day” approaches, debates about the trade-offs around managing the COVID-19 pandemic seem to be intensifying. The “hawks” want to continue restrictions to avoid a potential surge in infections, and more importantly, hospitalisations and deaths. The “doves” understand the risks, but are concerned about the economy, employment and incomes. Those of us refusing to have a view — because the analysis to arrive at one is near-impossible — tend to argue that whatever the other arguments, we should focus on the “no regrets” action of accelerating vaccination programmes as much as possible. …
As the government’s furlough scheme starts to taper down in July, all eyes are on labour market statistics: will furloughs, which peaked at nearly 9 million in May 2020, convert into employment or unemployment? On one hand, there have been signs of a surprisingly robust labour market recently; on the other, there is still a risk that a substantial proportion of people on furloughs end up being laid off, rather than re-employed (at least straight away).
Unfortunately, official statistics on claimant counts, furloughs and unemployment lag behind real time. [For example, furlough data for May 2021 has just been published…
A lot of the “levelling up” debate has focused on employment and incomes, and rightly so: these are important elements of prosperity for any region. However, they are not the most important contributors to people’s life satisfaction; mental and physical health and social relationships are, on average, more consequential. And this is where the story gets interesting.
As the chart shows, at the local authority level in the UK, there is essentially no correlation between incomes and life satisfaction [left hand panel]. Indeed, people in London (light blue) are among the highest-income but least satisfied with their lives. There are…
It is clear that, at the individual level, COVID-19 has led to further polarisation: individuals with lower incomes or poorer health have suffered the most (see 8 February here). However, many have taken this to mean that, geographically too, the lowest-income areas have taken the largest hit.
This is true to some extent, but only at a very granular level. For example, within types of geographies (e.g., among different cities, or comparing different towns), historically less-well-off parliamentary constituencies had the highest claimant count figures in January (see 24 February here). With higher levels of aggregation, the opposite is true: places…
Tera Allas
I help complex organisations make the right strategic decisions through innovative, insightful and incisive analysis and recommendations.
