West Midlands Weekly Economic Impact Monitor – 30th April 2021

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Following the easing of lockdown key indicators are showing the start of a return to normal. Footfall statistics indicate that people are more comfortable with leaving home, but the majority of people still feel the pandemic is having a worrying effect on their lives. The latest skills data shows a significant improvement; however, this should be treated with cautious optimism until a longer-term pattern emerges. Sectors such as events/conferences are still struggling and have no clear roadmap as to when they will be able to trade again. Some businesses in the hospitality sector are still not open due to costs and capacity and in the last quarter there has been a significant rise in those not receiving pay, and vacancies have gone down, so although unemployment is holding steady there is considerable uncertainty in the labour market.

  • Across the board the region has improved on skills indicators, with better improvements in performance than the UK: the number of people with NVQ Level 4+ qualifications has increased by 10.3% since 2020; the number with ‘no qualifications’, decreased from 290,500 in 2019 to 223,800 in 2020 (23%); the number with NVQ Level 3 qualifications increased by 34,700 or +8.1%; the number of people with trade apprenticeships increased by 3,700 or +6.3%; and the number with NVQ Level 2 qualifications increased by 1.0%.
  • At 17th April 2021, retail footfall remains strong at 98% of its level when compared to the equivalent week of 2019. Week-on-week analysis (from 10th April to 17th April 2021) shows that footfall for shopping centres increased by 127%, high streets increased by 93% and retail parks increased by 35%.
  • UK’s economic growth prospects for 2021 have been significantly upgraded in the EY ITEM Club’s Spring Forecast published on 26th April: growth of 6.8% is expected this year rather than 5%.
  • In the US Visa has reported that in the last month US Nonfarm employment rose by 916,000 in March, while consumer confidence hit its highest mark since the beginning of the pandemic. Measures of real-time consumer spending indicated a sharp acceleration in spending in the final weeks of March, as the stimulus checks enacted by President Biden to support recovery made their way into consumers bank accounts.
  • A new survey by Survation shows that 1 in 12 private renters has been given notice to leave without reason since March 2020. 1 in 3 renters (2.78m) fears that they will lose their home in the year ahead, representing nearly 3 million adults across England. Shelter reports that over a third of renters fear being evicted for asking for repairs to their homes, leaving many living in very poor conditions.
  • The West Midlands is now considered by the government to be a strategically significant hub for levelling up FinTech (Financial Technology) in the UK with its appointment to the FinTech National Network
  • Research for Openreach has found that a comprehensive Full Fibre Network in the region could enable 85,000 new people to enter the region’s workforce. A nationwide roll-out would enable more than 29,000 people in the West Midlands to expand their working hours.
  • Openreach also announced it is investing millions of pounds on a Full Fibre rollout to dozens of towns and cities in the region, including many in the hard-to-reach ‘final third’. Build is already underway including in the city areas of Birmingham and Coventry, as well as harder to reach places such as Cannock and Burton-upon-Trent in Staffordshire.
  • Wonkhe argues that by enabling universities to more easily commercialise their research will help the government reach their R&D goals.
  • Centre for Cities shows that whilst 70% of people in the West Midlands know we have a metro mayor, only 30% were able to correctly give his name. This picture is similar for other metro mayors.
  • Social Market Foundation polling shows that many people value vocational qualifications, regardless of age or their own background, in direct opposition to policy and media which under-report on vocational options.
  • A £1bn investment by Oval Real Estate in the Digbeth area has been recommended for approval in Birmingham

Covid Impacts

  • In England, the percentage of people testing positive for the coronavirus (COVID-19) has continued to decrease in the week ending 16 April 2021, to around 1 in 610 people.
  • The Midlands has successfully vaccinated 3m people with the first dose and 1.5m of these individuals have received the second dose. The Midlands continues to provide the most first doses, and has become the highest provider of the second dose.
  • 44% of West Midlands residents felt very comfortable or comfortable leaving home (50% GB). 29% felt uncomfortable or very uncomfortable leaving home due to COVID-19. 58% of adults reported they were very or somewhat worried about the effect COVID-19 was having on their life.
  • There were 28.2 million payrolled employees in the UK, a fall of 2.8% compared with last year; 607,000 vacancies in January 2021 to March 2021. This is 178,000 (22.7%) fewer than the estimated 785,000 vacancies a year earlier.
  • Alternative claimant count data estimates 217,933 claimants in the WMCA (3 LEP) area in February 2021, an increase of 79.0% (+96,167) when compared to February 2020.
  • Approximately 500k employees received no pay while their job was on hold and/or affected by the coronavirus pandemic in April and May 2020. Most of the year this has been flat at 200kt but has raised by 300k in last qtr
  • Reports of redundancy in the three months prior to interview increased by 3.5 per thousand on the year, but decreased by a record 6.8 per thousand on the quarter.
  • The regional employment rate is 74.1%, an increase of 0.3 percentage points from the previous quarter. The unemployment rate (aged 16 years and over) was 5.5%, representing a decrease of 0.5 percentage points on the previous quarter.
  • There were 216,390 claimants aged 16 years and over in the WMCA (3 LEP) area in March 2021. This is an increase of 1,320 people when compared to February 2021.
  • There were 5,325 voluntary dissolution applications, an increase from 5,059 recorded in the previous week. The number of voluntary dissolution applications was higher than levels seen in the sixteenth week of 2020 (3,631) and the same week in 2019 (4,903).
  • 0% of trading businesses in the West Midlands reported profits had decreased by at least 20%. However, 39.1% of trading businesses in the West Midlands reported that profits had stayed the same and 12.0% reported their profits had increased by at least 20%.
  • Over 200,000 more people are at risk of poor mental health due to unemployment, according to The Health Foundation
  • Food and Drink Industry Report 2021 has found that the pandemic has significantly impacted businesses operating in the food and drinks sector. The UK saw the export of food and drink fall by 9.7% (£21.3bn). Value of exports has fallen by -8% and -12.1% respectively and dependence on imports increasing by 9.2% compared to 2019. The largest fall was in Scotland at 16.2%. West Midlands saw a 4.6% decrease in food and drink.
  • The Institute for New Economic Thinking found that the most important factor to estimate how well a country has managed the pandemic is the presence of pre-pandemic austerity measures.
  • Resolution Foundation examines the impact on COVID on young people’s employment, and finds that many more will experience unemployment and wage scarring due to larger numbers of 16-24 year olds being negatively affected, despite higher numbers in full time education. Male graduates are still experiencing high unemployment rates, young women are more likely to be laid off, and young Black and Asian people finding it harder to access any work or education.
  • Campaign for Better Transport has found that many people still want to use private cars for most of their travel after the pandemic according to a recent survey. This damages the chances for a green recovery, but also highlights customer desire for less crowded, cheaper public transport.
  • The UK stands 12th in the Global Labour Resilience rankings, but this hides regional inequalities in employment and labour market resilience, according to Whiteshield Partners.

EuExit

  • European Parliament has given its overwhelming backing to the Trade and Co-operation Agreement (TCA) trade and security deal, with 5 MEPs voting against the deal, 660 in favour and 32 abstentions
  • Northern Irish trade is also an issue, as under a separate protocol, Northern Ireland remains de facto part of the EU’s single market. Therefore, goods arriving to Northern Ireland from the UK now have to undergo EU checks.
  • 6% of responding West Midlands businesses reported they had made changes to supply chains, nearly 2/3 as a result of a new UK trade agreement. 43.0% of responding West Midlands businesses reported they were using more UK suppliers.
  • Many issues raised in earlier monitors continue such as import costs, steel prices, shortage of raw ingredients such as polymers, import duty and demand for support continue to be of concern.

This week we are asking all readers to participate in a survey, the purpose will be to better understand how our readers use the Monitor and this will then inform the development of future Monitors. For instance, we are eager to understand whether the continuation of the weekly Monitor would be beneficial or relevant to your work in the long term. We are also interested in what content would be useful going forward. Please follow the link to the survey here, it should only take 5 minutes. West Midlands Monitor Survey

Download and view a copy of the West Midlands Economic Monitor.


The bi-weekly monitor brings together data and intelligence from the WM REDI partnership into one single source which can be shared and utilised in planning and responding to the challenge of the virus. This is a rapid review of the issues. It is not intended to be a comprehensive assessment but rather a practical report which places emphasis on emerging issues and the best data and intelligence we have to date.

The monitor is feeding into the regional recovery planning that can help the regional economy bounce back and quickly move forward once lockdown restrictions start to be lifted.

The work is being endorsed by political and business leaders a task force of experts are being set up through WM REDI partners to better understand the impact of the lockdown and what measures will be needed to get the economy moving again.


City-REDI / WM REDI has developed a resource page with all of our analysis of the impact of Coronavirus (COVID-19) on the West Midlands and the UK. It includes previous editions of the West Midlands Weekly Economic Monitor, blogs and research on the economic and social impact of COVID-19. You can view that here.

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