Think of London and perhaps the first thing that springs to mind is high finance or politics. But the city is also home to an enormous retail, hospitality and tourism market. It’s also a varied environment, including industries that flourish in central London and in the outer boroughs.
In London’s outer boroughs alone, over 7% of residents work in “tourism characteristic industries” according to the ONS, reflecting the focus on passenger transport as this is the location of Heathrow Airport.
It’s these industries that were among the hardest hit by the ongoing coronavirus pandemic. London was at the forefront of the pandemic’s direct impact in the UK in March and April 2020.
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The economic consequences of COVID-19 continue to unfold:
- The number of people claiming unemployment benefits increased by 2.5 times between January and May, compared to a UK average of 2.1 times.
- Advertised job vacancies were down 56% in July compared to their pre-crisis level, much like the rest of the country.
The economic recovery in London has been uneven. Different parts and sectors of the city are recovering at different rates. Data on take-up of the government Job Retention Scheme confirm London’s resilience in professional and financial services, where remote working has enabled operation through the crisis.
Londoners and regional commuters have been avoiding public transport, so with 82% of commutes into the city centre usually made on public transport, a great deal of pre-crisis activity remains suppressed.
The viral outbreak has created some incidental benefits, however. Some spending has shifted to secondary town centres. Some smaller town centres such as Southall or East Ham have seen increases in transactions, while larger town centres have seen smaller decreases than in central London. So far London’s recovery looks suburban.