Research published by the Centre for Economics and Business Research (CEBR) has revealed that UK economic output has reduced to 31% as a result of the coronavirus (COVID-19) lockdown.
The CEBR warned that the lockdown has ‘extremely severe economic consequences’ for the UK. According to the research, the manufacturing sector is set to see the highest fall in output in absolute terms as a result of workers who produce goods being unable to do so remotely from home. The CEBR estimates that this will cost the UK economy £500 million a day, with production in the sector reduced to 69%.
The Centre also stated that the accommodation and food services sector is likely to be ‘disproportionately impacted’. However, the UK services sector is less likely to be adversely affected, as employees in this sector have greater ability to work remotely.
According to the CEBR, the COVID-19 lockdown is costing the UK £2.4 billion per day.
Douglas McWilliams, Deputy Chairman of the CEBR, said: ‘These results show that the manufacturing sector, as well as the more obvious sectors such as retail and leisure, is one of the more badly hit by the virus and economic slowdown.
‘Many of the government measures do little to help capital intensive sectors like manufacturing, which benefits relatively less from furloughing employees and is essentially excluded from rate relief.’