The Real-Time Economic Effects of Covid-19 in the United Kingdom
Lead Research Organisation:
London School of Economics and Political Science
Department Name: Centre for Economic Performance
Abstract
This project will examine the microeconomic impacts of the Covid pandemic and lockdown on UK businesses and its interaction with the UK's decision to leave the European Union.
The project will deliver two key outputs, which are fundamental to designing and monitoring appropriate policies to mitigate the negative economic impacts of Covid. A first key output will be to provide real-time monthly summaries of the impacts of Covid on UK businesses and their expectations of business and employment outcomes for the coming months. This will use confidential information from firm-level surveys conducted by the Confederation of Business Industry (CBI), made available to us through a special agreement between CBI and the Centre for Economic Performance. The data are unique in providing rich, real-time, firm-level information on current trends and expectations. The surveyed firms have a broad coverage of sectors and regions and our previous work shows that they can deliver nationally representative economic analysis. Supplementing CBI survey data with firm and industry characteristics from ONS and company accounts, a second key output of the project will examine the channels through which businesses are being affected by Covid, such as demand, supply chains, and finance, and the interaction (if any) between these impacts and the effects of Brexit.
The project will identify the heterogeneity of impacts by firm-size, sector, and region, and the evolution of business activity as the economy recovers and the UK leaves the EU. The granular findings will help design detailed policy responses.
The project will deliver two key outputs, which are fundamental to designing and monitoring appropriate policies to mitigate the negative economic impacts of Covid. A first key output will be to provide real-time monthly summaries of the impacts of Covid on UK businesses and their expectations of business and employment outcomes for the coming months. This will use confidential information from firm-level surveys conducted by the Confederation of Business Industry (CBI), made available to us through a special agreement between CBI and the Centre for Economic Performance. The data are unique in providing rich, real-time, firm-level information on current trends and expectations. The surveyed firms have a broad coverage of sectors and regions and our previous work shows that they can deliver nationally representative economic analysis. Supplementing CBI survey data with firm and industry characteristics from ONS and company accounts, a second key output of the project will examine the channels through which businesses are being affected by Covid, such as demand, supply chains, and finance, and the interaction (if any) between these impacts and the effects of Brexit.
The project will identify the heterogeneity of impacts by firm-size, sector, and region, and the evolution of business activity as the economy recovers and the UK leaves the EU. The granular findings will help design detailed policy responses.
| Description | The project used data for early 2021 to document how firms are adapting to the end of the Brexit Transition Period. In the latest report, we document how the economy is adapting to the latest conditions of the pandemic and continued adaption to Brexit. We focus on the impact of labour shortages on UK firms, showing that firms in all industries and of all sizes experienced shortages. We show how firms are adapting, and that nearly half of firms expect shortages to last at least a year. The findings of this report will be presented at an OECD webinar for policymakers. |
| Exploitation Route | A key aspect of the project is to disseminate findings in real time. We hope to continue to be in touch with Tilly Gamble at UKRI, who has been very supportive on this front. |
| Sectors | Communities and Social Services/Policy,Creative Economy,Government, Democracy and Justice,Retail,Transport |
| Description | A key aspect of the project is to disseminate findings in real time. As such, we have published research findings in established high-impact blog platforms. Usually, the research has been cross posted on multiple outlets to maximise impact. One the most notable successes of the project has been the engagement from the media. Most of the analysis was widely picked up by the domestic and international media and the project investigators have taken an active role in responding to media queries. As an example, the Guardian article covering our early research was viewed over half a million times. The team was active in disseminating findings to policymakers. For example, the PI has presented the insights from the real-time updates at the HMT, FCDO and APPG for Textiles and Fashion on Retail. The PI was also on the Economic Recovery Taskforce on Investment for BEIS. |
| First Year Of Impact | 2020 |
| Sector | Communities and Social Services/Policy,Creative Economy,Government, Democracy and Justice,Manufacturing, including Industrial Biotechology,Retail,Transport |
| Impact Types | Societal,Economic,Policy & public services |
| Description | Confederation of British Industry (CBI) |
| Organisation | Confederation of British Industry (CBI) |
| Country | United States |
| Sector | Private |
| PI Contribution | We have used the CBI monthly business survey data to provide analysis used by CBI both internally and externally. |
| Collaborator Contribution | CBI have provided us with access to their monthly business survey data throughout the project. They have also promoted our research through their various outlets. |
| Impact | "Real-time updates on the UK economy: trends, expectations and implications from business survey data" Josh De Lyon and Swati Dhingra. CEP Covid Analysis, December 2021. "The impacts of Covid-19 and Brexit on the UK economy: early evidence in 2021" Josh De Lyon and Swati Dhingra. CEP Covid Analysis, May 2021. "Covid-19 and Brexit: Real-time updates on business performance in the United Kingdom" Josh De Lyon and Swati Dhingra. CEP Covid Analysis, July 2020. "Labour shortages have become widespread - this is how firms are responding" Josh De Lyon and Swati Dhingra, December 2021, LSE Business Review. "The importance of training" Josh De Lyon and Swati Dhingra, February 2021, Institute for the Future of Work; LSE Business Review "Businesses' preparation for Brexit" Josh De Lyon, Swati Dhingra and Edoardo Tolva, December 2020, LSE Brexit "Covid-19 and Brexit: Contrasting sectoral impacts on the UK" Josh De Lyon and Swati Dhingra, June 2020, VoxEU . "How is Covid-19 affecting businesses in the UK?" Josh De Lyon and Swati Dhingra, May 2020, LSE Business Review . |
| Start Year | 2020 |
| Description | Newspaper interview |
| Form Of Engagement Activity | A press release, press conference or response to a media enquiry/interview |
| Part Of Official Scheme? | No |
| Geographic Reach | National |
| Primary Audience | Public/other audiences |
| Results and Impact | Interview with newspaper El Pais to discuss labour shortages, migration and its relationship to Brexit and Covid by project member Josh De Lyon. |
| Year(s) Of Engagement Activity | 2022 |
| Description | Press Release for CEP Report |
| Form Of Engagement Activity | A press release, press conference or response to a media enquiry/interview |
| Part Of Official Scheme? | No |
| Geographic Reach | International |
| Primary Audience | Media (as a channel to the public) |
| Results and Impact | CEP Press Release for: "The impacts of Covid-19 and Brexit on the UK economy: early evidence in 2021" Josh De Lyon and Swati Dhingra. CEP Covid Analysis, May 2021. The research was subsequently cited in: Bloomberg, The i Paper , The Independent, ICAEW, SFN Scottish Financial News, Process & Control Today, |
| Year(s) Of Engagement Activity | 2021 |
| Description | Press Release for CEP Report |
| Form Of Engagement Activity | A press release, press conference or response to a media enquiry/interview |
| Part Of Official Scheme? | No |
| Geographic Reach | International |
| Primary Audience | Media (as a channel to the public) |
| Results and Impact | CEP press release for: "Real-time updates on the UK economy: trends, expectations and implications from business survey data". The research was subsequently cited in: Financial Times, Sky News, The Times, Yahoo, ITV News, The Independent, Business Live, News and Start The Cumberland News, Staff Industry, India Education Diary, HR News, Onrec, The Leader, Leicester Mercury, Morning Star, The Journal, Alliance News Global, Alliance News Global, Liverpool Echo, Shropshire Star, Inverness Courier, Express and Star, Manchester Evening News |
| Year(s) Of Engagement Activity | 2021 |
| Description | Press Release for the CEP Report |
| Form Of Engagement Activity | A press release, press conference or response to a media enquiry/interview |
| Part Of Official Scheme? | No |
| Geographic Reach | International |
| Primary Audience | Media (as a channel to the public) |
| Results and Impact | The Centre for Economic Performance published a press release to publicise our report on the sectoral impacts of Covid and Brexit in July 2020. The research was subsequently cited in at least 10 news outlets. The research was covered in The Guardian, where it received over half a million online views. The newspaper let us know that this is unusually high. |
| Year(s) Of Engagement Activity | 2020 |
| Description | Radio Interview |
| Form Of Engagement Activity | A press release, press conference or response to a media enquiry/interview |
| Part Of Official Scheme? | No |
| Geographic Reach | National |
| Primary Audience | Public/other audiences |
| Results and Impact | Radio interview for BBC Radio Scotland to discuss findings of our report by project member Josh De Lyon |
| Year(s) Of Engagement Activity | 2021 |
| Description | Radio Interview |
| Form Of Engagement Activity | A broadcast e.g. TV/radio/film/podcast (other than news/press) |
| Part Of Official Scheme? | No |
| Geographic Reach | National |
| Primary Audience | Public/other audiences |
| Results and Impact | Swati Dhingra interviewed for BBC Radio 4 to discuss the research findings of the project on businesses' preparation for Brexit |
| Year(s) Of Engagement Activity | 2020 |
| Description | Radio Interview |
| Form Of Engagement Activity | A broadcast e.g. TV/radio/film/podcast (other than news/press) |
| Part Of Official Scheme? | No |
| Geographic Reach | National |
| Primary Audience | Public/other audiences |
| Results and Impact | Swati Dhingra was interviewed on LBC on 7th December 2020 to discuss the project's findings that businesses are relatively unprepared for Brexit. |
| Year(s) Of Engagement Activity | 2020 |
| Description | Research Policy Blog |
| Form Of Engagement Activity | Engagement focused website, blog or social media channel |
| Part Of Official Scheme? | No |
| Geographic Reach | International |
| Primary Audience | Policymakers/politicians |
| Results and Impact | Blog post aimed to increase outreach of the project analysis. Title: Labour shortages have become widespread - this is how firms are responding |
| Year(s) Of Engagement Activity | 2021 |
| URL | https://blogs.lse.ac.uk/businessreview/2021/12/15/labour-shortages-have-become-widespread-this-is-ho... |
| Description | Research Policy Blog |
| Form Of Engagement Activity | Engagement focused website, blog or social media channel |
| Part Of Official Scheme? | No |
| Geographic Reach | International |
| Primary Audience | Public/other audiences |
| Results and Impact | The article presents a discussion of the importance of employer-provided training as a response to the Covid-19 pandemic. It provides new evidence that most firms have reduced their expenditure on training since the onset of the pandemic. It is published on the Institute for the Future of Work website and was widely circulated by the Think Tank. The article was also published in the LSE Business Review. |
| Year(s) Of Engagement Activity | 2020 |
| URL | https://www.ifow.org/news-articles/the-importance-of-worker-training-in-post-covid-19-recovery |
| Description | Research Policy Blog |
| Form Of Engagement Activity | Engagement focused website, blog or social media channel |
| Part Of Official Scheme? | No |
| Geographic Reach | International |
| Primary Audience | Public/other audiences |
| Results and Impact | This article, published on LSE Brexit Blog, examines the effect of Covid-19 on businesses ability to prepare for Brexit in the UK. The research was covered in the Guardian, Yahoo News, Times Radio, CNN and LA Times. |
| Year(s) Of Engagement Activity | 2020 |
| URL | https://blogs.lse.ac.uk/brexit/2020/12/07/covid-19-has-disrupted-businesses-ability-to-prepare-for-b... |
| Description | Research Policy Blog |
| Form Of Engagement Activity | Engagement focused website, blog or social media channel |
| Part Of Official Scheme? | No |
| Geographic Reach | International |
| Primary Audience | Public/other audiences |
| Results and Impact | The blog provides analysis of the real-time effects of Covid and their relation to the effects of Brexit at the sectoral level. VoxEU is an international outlet for "research-based policy analysis and commentary by leading economists" and in April 2020 it had 1.6 million page views. The methodology has been adopted in "Examination of the sectoral overlap of COVID-19 and Brexit shocks", by Luke Daly and Martina Lawless. |
| Year(s) Of Engagement Activity | 2020 |
| URL | https://voxeu.org/article/covid-19-and-brexit-contrasting-sectoral-impacts-uk |
| Description | Response to media enquiry |
| Form Of Engagement Activity | A press release, press conference or response to a media enquiry/interview |
| Part Of Official Scheme? | No |
| Geographic Reach | National |
| Primary Audience | Public/other audiences |
| Results and Impact | Josh De Lyon provided a written interview to London-based news wire AFP on the effects of Covid-19 and Brexit on the UK economy. The interview was further covered by MSN News and Gestion. |
| Year(s) Of Engagement Activity | 2020 |
| Description | Workshop Presentation |
| Form Of Engagement Activity | A formal working group, expert panel or dialogue |
| Part Of Official Scheme? | No |
| Geographic Reach | International |
| Primary Audience | Policymakers/politicians |
| Results and Impact | Josh De Lyon will present the findings of the latest report of the grant at an OECD invitation-only workshop on international labour shortages. The workshop will include OECD officials and government policy makers. |
| Year(s) Of Engagement Activity | 2022 |