Tag: Economy

Edinburgh Airport ‘outlook bleak’

Passenger numbers decline to lowest level since 1995

Edinburgh Airport recorded its lowest number of passengers since 1995 in the last 12 months, and the outlook is bleak as the Covid-19 pandemic continues.

The airport handled a little under 3.5m passengers in 2020 – a 76% reduction on the previous year which is estimated to cost the Scottish economy around £1bn and over 21,000 jobs during the same period.

Gordon Dewar, Chief Executive of Edinburgh Airport said: “Our thoughts are with those who have lost loved ones through this pandemic and with those on the frontline managing the health crisis.

“The fall in our passenger numbers is only one reflection of the long-term damage being inflicted by Covid-19 on Scotland’s economy and its social fabric, but it is a worrying one and there is no clear path to recovery.

“Nobody should assume that when the pandemic subsides, life will go back to normal. At the airport, we will be starting from a low level of activity not recorded here since 1995 and the choice of airlines and destinations may be dramatically different to those we had worked hard to build before 2020 and on which many people depend for bringing visitors to Scotland and for holidays and business, including exports.

“We believe that now is the right time for industry, government and trade unions to be thinking about a substantial economic recovery plan – one that does not distract the health professionals from the important job of saving lives and protecting the NHS today, but one which puts Scotland in the best possible position to recover as quickly as possible when the conditions allow.

“The power and impact of the aviation industry cannot simply be measured on passenger numbers and the number of aircraft arriving and departing – thousands of people rely on airports and airlines, and their vast supply chains, for the income that puts food on the table and pays the bills. Other countries around the world are providing support for their aviation sectors and UK and Scottish Governments should do the same.”

Independent research on the airport’s economic impact suggests the reduction in passenger numbers to a total of 3,478,501 resulted in a cost to the Scottish economy of £1bn and over 21,000 jobs.

After ten years of significant growth, passenger numbers were down in every quarter as the pandemic took a grip on Scotland with tighter restrictions on travel and border controls.

The vast majority of people travelled before the pandemic hit and numbers plummeted by 99% between April-June, 83% between July-September and 90% between October-December.

Quarter2019 total2020 totalVariance
Q12,966,8852,369,388-20%
Q24,053,31934,247-99%
Q34,368,976750,823-83%
Q43,358,361324,043-90%
Full year14,747,5413,478,501-76%

In early 2020, Edinburgh Airport worked with BiGGAR Economics to understand the positive impact of the airport on Scotland’s economy. Their report found that in 2019, Edinburgh Airport generated £1.4 billion Gross Value Added (GVA) and 28,000 jobs in the Scottish economy.

Wider than that, the report found Covid-19 also impacted on several other things such as:

  • allowing freedom of movement;
  • bringing opportunities for people to live more meaningfully and experience other cultures;
  • promoting Scotland’s culture and heritage;
  • enabling people to remain in contact with friends and family; and
  • enhancing Scotland’s accessibility for visitors.

Confidence drops in Scotland as lockdown restrictions continue

Bank of Scotland’s Business Barometer for January 2021 shows:

  • Overall confidence of firms in Scotland fell 23 points in the past month to -32%
  • 52% of firms are confident the Covid-19 vaccination roll-out will boost trading prospects in 2021
  • Optimism falls in seven of 11 UK regions and nations as firms deal with latest lockdown restrictions

Business confidence in Scotland fell 23 points during January to -32%, according to the latest Business Barometer from Bank of Scotland Commercial Banking.

Companies in Scotland reported lower confidence in their own business prospects month-on-month, down 20 points to -27%.  When taken alongside their views of the economy, down 25 points to -37%, this gives a headline confidence reading of -32%.

The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.

The majority (65%) of firms said current Covid-19 restrictions had caused a fall in turnover but they expected the effects of the vaccine programme to boost trading prospects for 2021, with 52% saying the rollout had made them feel more confident about the year ahead. However, only 11% expect trading levels to return to pre-pandemic levels in the next twelve months.

When it comes to jobs, a net balance of 28% of businesses in Scotland expect to reduce staff levels over the next year, down five points on last month.

At UK level, overall business confidence dipped in January as the latest lockdown restrictions came into force, falling by three points to -7%. Firms’ economic optimism dropped dramatically month-on-month, decreasing by 34 points to -10%.

Almost all UK nations and regions saw a month-on-month dip in confidence during January, with the biggest falls after Scotland (-32% vs -9% in December) being reported in Wales (-20% vs -1% in December) and the South West (-8% vs 5% in December).

However, firms reported a month-on-month increase in confidence in London (up five percentage points to 3%), the South East (up seven percentage points to -4%) and North West (up eight percentage points to -5%). Yorkshire business confidence remained steady month-on-month at -4%.

Fraser Sime, regional director for Scotland at Bank of Scotland Commercial Banking, said: “This latest drop in confidence has appeared against a backdrop of tighter restrictions being reintroduced in Scotland. However, despite this dip, fewer firms report they are planning on making redundancies in the year ahead, the second consecutive month this has fallen.

“We know Scottish businesses have been resilient since the pandemic began and the vaccination roll-out is boosting firms’ optimism about the coming months. We’ll be by the side of businesses to help them navigate both the short-term challenges and long-term opportunities ahead.” 

In the industry sectors confidence remained above pre-vaccine levels (chart 4). While some sectors reported declines, manufacturing slipped by nine points to 9%, services fell by four points to -9% and retail by five points to 6%. Confidence levels in the construction sector improved for a second month, rising four points to -1%.

Paul Gordon, Managing Director for SME and Mid Corporates, Lloyds Bank Commercial Banking, said: “It has not been an easy start to 2021, but nonetheless businesses continue to persevere and remain resilient in the face of uncertainty and change – the construction sector’s confidence improving for a second month and more broadly, industry and the majority of the regional confidence sitting above pre-vaccine levels.

“While the road ahead will be challenging, we hope the news of the vaccine rollout progress will positively impact regional and sector confidence in the coming months.”

Hann-Ju Ho, Senior Economist, Lloyds Bank Commercial Banking, said: “It has been a challenging start to the New Year for UK businesses adapting to a third national lockdown alongside the new EU trade arrangement taking effect.

“Nevertheless, while confidence remains below average, it is encouraging that business sentiment is still the second highest since the low of May 2020. Overall, the vaccine rollout programme has lifted confidence and that will hopefully buoy business optimism in the coming months.”

Covid-19 makes improving Scotland’s economy almost four times harder

 Dundee faces the biggest challenge in Scotland

  • Glasgow also faces a big challenge.
  • Better adult education, transport investment and improvements to Scotland’s urban centres needed.

Covid-19’s economic damage makes the task of improving Scotland’s economy and spreading prosperity almost four times harder according to Centre for Cities’ annual study of the UK’s major urban areas – Cities Outlook 2021.

30,900 people in Scotland’s largest cities now need to find secure, well-paid jobs to rebuild and improve the economy – compared to 8,600 last March.

 In Scotland, Dundee faces he biggest challenge, followed closely by Glasgow.

Scottish cities facing the biggest economic challenges post-Covid
RankCityPercentage point reduction in unemployment to rebuild and improve the economy
1Dundee4.1
2Glasgow4.1
3Aberdeen3.4
4Edinburgh3.0
Source: ONS, Claimant count 2020, population estimates 2019.

In addition to hitting some Scottish cities and the rest of the UK as a whole badly, Covid-19 has also hit many previously prosperous places such as Edinburgh, Aberdeen and London disproportionately hard.

The Government must act fast to prevent a levelling down of these places that the whole UK depends on to create jobs and fund public services.

The UK and Scottish Governments should announce how they will use their respective powers to deal with Covid-19’s short-term damage to cities and large towns. The plans should include:

  • Making permanent the £20 rise in Universal Credit.
  • Supporting jobless people to find new good jobs.
  • Consider the merits of a renewed Eat Out to Help Out scheme for hospitality and non-online retailers once it is safe.

Acting to prevent further economic damage by Covid-19 is not the same as levelling up. Once the health crisis ends, the Scottish Government will need to spend additional money on further measures to level up, including:

  • Further education to train jobless people for good roles in emerging industries.
  • Making city centres better places for high-skilled businesses to locate.
  • Improvements to transport infrastructure in city-regions.

Centre for Cities Chief Executive Andrew Carter said:  “Covid-19 has made the task of improving Scotland’s economy and spreading prosperity around its cities and towns much harder.

“Rebuilding and strengthening the economy of Scotland and its cities will not be cheap and will require more than short-term handouts. Government support and investment for new businesses in emerging industries will be essential, as will spending on further education to train people to do the good-quality jobs created.”

Pay: The Great Divide

The High Pay Centre’s ‘High Pay Day’ research, published this week, is evidence that the government must rebalance the economy after Covid-19 to make it fair, says the TUC.

High Pay Day is the day in 2021 on which the typical FTSE 100 chief executive has already earned the same as the average wage for a whole year. 

The research finds that top bosses earn around 120 times the annual pay of the average worker. 

High Pay Centre’s research suggests that the median FTSE 100 CEOs earnings for 2021 surpassed the median annual wage for a full-time worker in the UK at around 5:30 pm on Wednesday 6 January.

The calculations are based on our previous analysis of CEO pay disclosures in companies annual reports, combined with government statistics showing pay levels across the UK economy.

HPC estimate that with CEO pay levels remaining essentially flat in their analysis, while pay for UK workers had increased slightly, it means that CEOs have to work 34 hours of the year to surpass median earnings, rather than just 33 hours in 2020.

However, the most recent figures on CEO pay and UK full time workers’ annual earnings is still too dated to fully account for the impact of the coronavirus – therefore it remains to be seen how this has affected pay gaps across the UK, both over the duration of the pandemic and in the longer term.

Pay for top CEOs today is about 120 times that of the typical UK worker. Estimates suggest it was around 50 times at the turn of the millennium or 20 times in the early 1980s.

Factors such as the increasing role played by the finance industry in the economy, the outsourcing of low-paid work and the decline of trade union membership have widened the gaps between those at the top and everybody else over recent decades.

These figures will raise concern about the governance of big businesses and whether major employers are distributing pay in a way that rewards the contribution of different workers fairly. They should also prompt debate about the effects that high levels of inequality can have on social cohesion, crime, and public health and wellbeing.

TUC General Secretary Frances O’Grady said: “This tells you everything you need to know about how unfair our economy is. 

“Our army of minimum wage workers – carers, shop assistants and delivery drivers – have kept the country going through the pandemic. Not these CEO’s at the top raking in far more than their share. 

“We must make the economy fair. If the government is serious about levelling up Britain, it needs to start by levelling up pay and conditions for those we most rely on, and stop the threat to freeze key workers’ pay. 

“Ministers must bring forward the long-awaited employment bill to end expoitative working practices like zero hours contracts, and boost rights and pay.”

Additional £48 million for level 4 changes

Action to ensure businesses across Scotland impacted by level 4 restrictions get additional and faster access to financial support have been announced by the Finance Secretary Kate Forbes.

This is in addition to the £570 million package of support, including the Strategic Framework Business Fund which has been open since November.

Businesses that are required to close or modify their operations by law can apply for a Temporary Closure Grant or a Business Restrictions Grant through their local authority website. Grants of up to £3,000 are available for every four weeks of restrictions, payable in arrears while restrictions last.

An additional £41 million will top up support for non-essential retail and gyms, which are required to close in level 4. This is in addition to top up grants for hospitality that were announced earlier this month.

Non-essential retail and gyms will be given up to an additional £3,000 and can claim this funding through their local authority website if they have not already submitted an application.

The cap on the maximum support available through the Strategic Framework Business Fund will also be lifted from 1 January for businesses that operate from multiple premises.

To accelerate the distribution of financial support, a further £7 million will help all local authorities recruit additional staff or backfill positions to meet increased demand for coronavirus (COVID-19) grants and speed up the payment process.

Ms Forbes said: “With mainland Scotland now entering level 4, the Strategic Framework Business Fund is already open to businesses required to close or modify their operations by law.

“In recognition of the substantial increase in the number of businesses eligible for support, I have provided additional financial resources of £7 million to local authorities to upscale operations and streamline grants. Work is already underway to ensure businesses get support as quickly as possible.

“I recently announced a top up grant to hospitality businesses, and today I can confirm that a further top up grant will be provided to non-essential retail businesses and gyms.

“Since March the Scottish Government has allocated more than £2.3 billion to business support and more than £1.2 billion to economic recovery.

“On top of the additional £570 million package of support announced at the start of this month, these changes will manage that increased demand, accelerating the grant application process and in turn getting these essential payments to businesses as quickly as possible.

“We welcome the news of further consequentials and will set out shortly how these will be utilised to meet the needs of business. It is likely that a significant amount will be used to meet the substantial increase in businesses applying to the Strategic Framework Business Fund at Level 4.”

Scottish National Investment Bank is open for business

The Scottish National Investment Bank has officially opened for business with the completion of its first major investment. It is the UK’s first mission-led development bank and it is being capitalised by the Scottish Government with £2 billion over ten years.

The bank’s proposed missions will focus on supporting Scotland’s transition to net zero, extending equality of opportunity through improving places, and harnessing innovation to enable Scotland to flourish.

It will provide patient capital – a form of long term investment – for businesses and projects in Scotland, and catalyse further private sector investment.

Today’s £12.5 million investment in Glasgow-based laser and quantum technology company M Squared will support the company’s further growth in Scotland and speaks to the bank’s proposed core missions.

First Minister Nicola Sturgeon said: “The Scottish National Investment Bank will help to tackle some of the biggest challenges we face now and in the years to come, delivering economic, social and environmental returns.

“It is hitting the ground running with its first major investment in M Squared – a great example of the ambitious and innovative companies we have here in Scotland that will be key to our economic recovery and future prosperity.

“The launch of the bank is one of the most significant developments in the lifetime of this parliament, with the potential for it to transform, grow and decarbonise Scotland’s economy.”

Scottish National Investment Bank Chair Willie Watt said: “Today is a key milestone for the Scottish National Investment Bank. Our launch enables us to make mission-led, strategic, patient investments in businesses and projects that can deliver benefits for the people of Scotland. I am excited about the role the Bank will play in supporting and enabling growth in the Scottish economy.

“We are particularly pleased that our first investment is in M Squared which is at the cutting edge of innovation and is a recognised world-leader in its field. It is our firm belief that the bank will make many more investments that deliver positive mission impacts in the years and decades to come.”

Dr Graeme Malcolm, CEO and founder of M Squared, said: “Science and advanced technologies have a major role to play in Scotland’s future economic prosperity. By increasing investment in research and development with a mission-based approach, Scotland has a real opportunity to actively tackle climate change and benefit from the coming quantum revolution.

“We are delighted that the Scottish National Investment Bank has invested in M Squared as its very first business – our shared commitments to society and the environment makes this an ideal partnership that will enable accelerated growth and progress in frontier technologies.”

Benny Higgins, Strategic Adviser to the First Minister on the establishment of the bank, said: “It has been a privilege to be part of an outstanding effort to make this a reality.

“We could not have predicted that the current pandemic renders the need for mission-led investment even more vital to create a robust, resilient wellbeing economy in Scotland.”

SNIBfactsheetDownload

Scottish Parliament’s Economy Committee publishes report on the impact of COVID-19 on Scotland’s economy

The Economy, Energy and Fair Work Committee has today published its interim report on the impact that COVID-19 has had on the economy in Scotland.

Over the summer, the Committee sought written evidence on four key strands of their inquiry:

• Impact on businesses and workers
• Role of the enterprise agencies and SNIB
• Plans for economic recovery (including scrutiny of the Advisory Group on Economic Recovery (AGER) report)
• Impact on young people.

The report published today is the result of focus groups and evidence sessions where the Committee heard about struggles that are being faced due to COVID-19.

Commenting, Committee Convener Gordon Lindhurst MSP said: “This is an extremely difficult time for many businesses and workers. They play a central role to life in Scotland, providing vital services and the revenue to fund public services.

The Committee would like to thank Scotland’s businesses and workers for their resilience and hard work throughout the pandemic and to acknowledge the trying times that many are facing.”

“More than ever our economy needs to be understood and given a helping hand and the work the Committee has been doing has had the aim of reaching out to those that need help and provide them a voice.”

While the Committee has published its report today, it is still welcoming evidence from stakeholders who have been affected by COVID-19.

Gordon Lindhurst MSP added: “The Committee is particularly concerned about the impact on the pandemic on young people; for example, there has been a severe drop in the number of young people starting Modern Apprenticeships for the period April to June 2020 (which fell by 80% over the year). ”

“Every effort must be made to support young people at this time; the Scottish Government must invite young people to participate in developing policies to help them at this critical time in their lives”

The published report can be found here

Over 54,000 Scottish SMEs fear closure from second UK lockdown

An estimated 35,070 Scottish SME*s (small and medium-sized enterprises) say it is likely their business will close permanently in the next 12 months as a result of the coronavirus crisis, with this figure rising to 54,776 in the event that a second national lockdown is introduced, according to a recent survey by Virgin Money*.

The research is reported in the latest Virgin Money Business Pulse, which provides a comprehensive insight into the performance of the UK’s SMEs and the environment in which they operate.

Across the UK as a whole, the survey, which was conducted in early September, revealed that almost one million SMEs fear they could close if there was a second lockdown. Two-thirds (66%) of SMEs said their profits were lower in April because of COVID-19 disruptions, including 21% whose profits took a hit of more than 50%. 

Despite lockdown restrictions easing over the summer months, 64% of profits SMEs’ profits over the past 30 days decreased due to coronavirus-related disruption, compared to expected profits for this period prior to the outbreak of the pandemic. 55% of these businesses believe it will take more than six months for profits to recover to pre-lockdown levels.

Underlining the continuing precarious situation for SMEs, 17% of businesses say it is very likely or somewhat likely they will be forced to close permanently in the next 12 months.  This number rises to almost a quarter (24%) when considered in the context of a potential second national lockdown, similar to that seen in March and April.

A key turning point for SMEs will be the closure of the Coronavirus Job Retention Scheme at the end of October.  42% of SMEs (excluding sole traders) expect their workforce to be smaller in December than it is in September. The new Job Support Scheme coming into force on 1 November is less generous than the furlough scheme, and so represents a significant withdrawal of fiscal stimulus.

However, the survey also uncovers some positives, with 15% of SMEs stating their profits were unaffected during lockdown and 10% noting their profits were higher, as demand for specific products, such as food and PPE, increased. 

In addition, the lockdown has prompted almost a quarter (23%) of SMEs to update their strategy, 21% to reshape their vision, and 12% have improved existing products and services.

The Virgin Money Business Pulse covers the first half of 2020, which captures the start of the COVID-19 crisis. 

The scale of the challenges experienced by SMEs is reflected in the Virgin Money Business Pulse, which fell to its lowest ever level of 32.9 in the second quarter of 2020. 

This was driven by record-low scores in the revenue, GDP and capacity indicators, although gains were made in the business costs and lending indicators.

Rock bottom commodity prices and falling wages have provided some relief to SMEs in the form of declining business costs.  Similarly, government-backed loans as part of the fiscal response to the pandemic, led to a record jump in SMEs’ borrowing, which has improved the lending indicator.

Elsewhere in the Virgin Money Business Pulse, the new Regional Rebalancing Tracker, which records regional economic inequalities in the UK, reveals the economic divide between London and the South East and the rest of the UK has continued to widen in the past six years. 

Scores are calculated based on a region’s convergence to the level of economic prosperity and opportunity in London and the South East.  The tracker reached a record low of 38.6 points in Q2 2020, with the lowest levels of convergence in the North East of England and the East Midlands.

Scotland’s individual Regional Rebalancing score was 37.6 in Q2 2020, with a weak rate of business creation weighing on the overall score. Productivity in Scotland is, however, the highest in the UK outside of London and the South East.

It is estimated that in 2020, workers in London and the South East generated on average £37.69 per hour worked. In Scotland, the corresponding figure is £30.13. This means that for every pound of output generated by workers in London and the South East, workers in Scotland generate an estimated 80 pence in the same amount of time.

Gavin Opperman, group business director at Virgin Money, said: “The results make for sober reading, but they are unsurprising given the extraordinary disruption of the last six months. 

“The COVID-19 pandemic has caused the deepest recession on record and recovery is slow, despite the national GDP figures regaining ground.  The UK’s SMEs have experienced unprecedented strain, with sales and profits affected by workplace closures, supply chain disruption, diminished productivity and declining household incomes.

“Despite the pickup in economic activity in the summer months, businesses are by no means out of the woods.  As we head into the autumn and winter months with newly introduced restrictions, the next six months will be critical for many businesses. 

“SMEs have shown tremendous resilience and innovation this year, with some excellent examples of creativity to pivot business models and maintain operations.  But there is no doubt there are tough times ahead.

“On a brighter note, the pandemic may offer SMEs the chance to continue longer-term with the new and more flexible work patterns the pandemic necessitated, helping to rebalance the spread of wealth and opportunity across the country.

“We will continue to focus on how we can best support the businesses we work with. The future is always hard to predict, perhaps more so now than ever, but we will aim to be the best partner we can be as the UK navigates through the economic recovery from the pandemic”.

*Calculated by The Centre for Economics and Business Research (CEBR), with research conducted by Censuswide from 04/09/20 to 07/09/20, with 501 SME decision makers

Alister Jack responds to latest Scottish GDP figures

Scotland’s GDP increased by 6.8% in July, according to statistics announced today by the Chief Statistician. The increase in the latest month follows revised estimates of 6.7% growth in June and 3.1% May, and falls of 20.1% in April and 4.9% in March.

Although GDP has increased for the last three months, it remains 10.7% below the level in February, prior to the direct impacts of the COVID-19 pandemic.

In July there has been further growth in the three main sectors of the economy. Output in the Services sector is estimated to have increased by 5.5% compared to June, output in the Production sector increased by 8.6%, and Construction sector output is estimated to have increased by 23.4%.

Read the monthly GDP Estimate for July.

Commenting on the publication of Scottish July GDP figures yesterday, Scottish Secretary Alister Jack said: “As the Prime Minister said last night, the struggle against covid is the single biggest crisis the world has faced in our lifetimes.

“The UK Government is focussed on stopping the spread of coronavirus and keeping people safe, while doing everything we can to protect the economy.

“Through the furlough and self-employed schemes, we directly supported more than 930,000 jobs in Scotland, a third of the workforce.

“Now, the Chancellor’s comprehensive Plan for Jobs is bringing in the Job Retention Bonus, creating new jobs for young people through the kick start scheme, doubling the number of work coaches, and are supporting jobs in the tourism and hospitality sectors through a VAT cut.”

Background points:

  • The UK Government has directly supported more than 930,000 jobs in Scotland, a third of the workforce through the furlough and self-employed schemes.
  • Over 1.8 million jobs in the hospitality sector have been supported through the Eat Out to Help Out scheme with more than 6.3 million meals eaten in Scotland.
  • The UK Government has loaned more than £2.3 billion to 65,000 Scottish businesses.
  • An additional £6.5 billion in Barnett Consequentials has been provided by the UK Government to the Scottish Government since March 2020.

Chancellor Rishi Sunak is expected to make an announcement on a new emergency employment scheme to replace the current furlough arrangements later today.

Cut unemployment by unlocking public service jobs, says TUC

  • NEW TUC REPORT identifies 600,000 existing public service vacancies and staff gaps that government could unlock quickly to cut jobless rate  
  • The more people in work, the faster we will work our way out of recession, says TUC 

A new TUC report has set out proposals for a public sector jobs drive to stave off mass unemployment and help the UK quickly recover from the Covid-19 recession. 

The UK entered the Covid-19 crisis with our public services weakened by a decade of cuts. But public service workers gave their all to keep essential services going. 

As we move out of the public health crisis, we are moving towards an economic crisis, with the Bank of England warning of mass unemployment with 2.5 million people out of work by the end of the year. 

Creating decent jobs 

The TUC’s report sets out a plan for public sector jobs to contribute to the fast employment growth the UK now needs. 

It identifies the additional staff required across the public sector to fill vacancies, address shortfalls in provision and meet future need. 

The union body is calling for government to urgently unlock the 600,000 jobs identified, including: 

  • 135,000 in health  
  • 220,000 in adult social care   
  • 110,000 in local government   
  • 80,000 in education  
  • 50,000 in civil service / public administration   

Taken together with proposals published by the TUC in June to create 1.25 million jobs by fast-tracking green infrastructure investment, this plan could deliver a total of 1.85 million new jobs in the next two years. 

Powering recovery 

The TUC says that the government-led jobs drive would help support a stronger and faster private sector recovery too, with opportunities in supply chains and from the boost to spending power across the economy. 

And it would help protect the Treasury from the revenue shortfall arising from the downside recovery scenario set out by the Office for Budget Responsibility (OBR). 

Under the OBR’s downside  scenario, peak unemployment would be two million higher than for the upside scenario. TUC analysis of OBR data finds that the Treasury would lose out on £520bn in revenue over the next five years on the downside scenario relative to the upside. 

The TUC says that the government must invest now to put the UK on the upside path – by preventing mass unemployment.  

Otherwise the nation will suffer the high costs of mass unemployment, weak revenue and slow growth for many years ahead. 

TUC General Secretary Frances O’Grady said:  “Working people carried the burden of the pandemic. They must not bear the brunt of the recession. The government must go all out to protect and create jobs and prevent the misery of mass unemployment. 

“The more people we have in work, the faster the recovery will be. But ministers are sitting on their hands. It’s absurd to leave unfilled vacancies and unmet need in public services when unemployment is rising. Ministers should urgently provide the funding that will unlock existing public services vacancies and create good new jobs.  

“Our plan to invest in good public services jobs will help workers avoid unemployment. It will strengthen the vital services that we all rely on. And it will get people out spending in local business and services. That’s how to drive the recovery forward.” 

congress-jobs-story_reportDownload

– TUC Congress 2020: The TUC’s 152nd annual Congress takes place today and tomorrow (Monday 14 and Tuesday 15 September).

For full details of the programme, how to watch debates and how to participate in digital fringe meetings, go to: https://www.tuc.org.uk/Congress2020