Employment in the South West of England is unlikely to return to pre-coronavirus levels until 2023, a new forecast from the chartered accountancy body ICAEW, published today, has predicted.
The region’s high reliance on tourism and self-employment, both of which have been hard hit by the pandemic, means employment is likely to drop below the national average this year and could face a weak recovery in 2021.
The forecast, produced in partnership with Oxford Economics, found that the South West will slightly underperform the rest of the UK in terms of output and employment over the next five years.
It also found that the South West’s recovery is likely to be slow because of the financial difficulties faced by its large number of independently-owned businesses. The region has the highest share of accommodation and food-related jobs in the UK.
Oxford Economics report found that sectors that had to shut during lockdown – such as restaurants and airlines – were badly hit by the pandemic. Manufacturers dependent on global supply chains, or where demand fell sharply, were also affected.
ICAEW said the report showed that an industrial strategy that focused on jobs for the future was essential to recovery.
Beverley Waters, ICAEW Regional Director for South and South West, said,“While there are signs of a rebound, this report is a sobering reminder of challenges facing the job market in the South West over the next few years.
“The coronavirus crisis means we have not had the tourists we rely on to visit, so a quick recovery looks unlikely.
“The Chancellor’s autumn budget should be a social, education and industrial strategy which combines protection and re-training for displaced workers over the short and medium term, with intervention and investment to create jobs with a future, especially in the green and scientific sectors.
“The furlough scheme did a good job of keeping staff attached to employers while unable to work. We now need to see the Government bring forward ways to support people back into their workplaces through the short-term economic uncertainty ahead.”
