Economics Observatory | Questions and answers about coronavirus and the UK economy

Road to recovery

While the immediate public health impact of Covid-19 seems to be easing in the UK, the likely long-term economic scars cannot be ignored. Policies targeting the most vulnerable – as well as investment in technology to improve productivity – are key to a sustainable recovery.

Data stories

What do the latest data reveal about UK trade?

Total trade was down in Q1 of 2021 as worldwide lockdowns halted economic activity. Trade with the EU took a particularly large fall as the UK’s transitory departure period ended on December 31^st suggesting Brexit has already had a large impact on trade.

Data stories

Could universal basic income work in Wales?

The Welsh government recently announced that it will pilot a universal basic income (UBI) scheme to alleviate poverty in the country. Other UBI experiments, such as Finland’s, may provide important lessons for Welsh policy-makers.

Inequality & poverty

What different ways can policy-makers address inequality?

Longstanding economic fractures have been widened by the pandemic. In response, a range of policy actions are needed across the income distribution and at all stages of the economic process.

Science, technology & innovation

Do our beliefs about future technology affect the economy?

New technologies, such as 5G telecommunications, self-driving vehicles and mRNA-based drugs and vaccines, have the potential to shape our future. Anticipation of their impact may already be affecting the economy today.

News

The new normal

While final lockdown restrictions in England were lifted on Monday, seeing people return to nightclubs mask-free, the ‘pingdemic’ has become a major problem for the UK. Industries are suffering from mass staff-shortages as self-isolation notifications hit record highs.

Data stories

Levelling up: Has Covid-19 reduced the regional employment gap?

Payroll data suggest that differences in employment across UK regions have reversed during Covid-19, with employment rising above pre-pandemic levels in some regions, with London falling behind. In contrast, traditional employment measures suggest all regions are yet to recover.

Jobs, work, pay & benefits

Will people go back to the office after the pandemic?

Covid-19 restrictions have forced many people to work remotely to mitigate the spread of the virus. But even after re-opening, a majority of employees would prefer flexible arrangements to continue, with working from home an option for some part of the week.

Data stories

UK inflation: What do the latest data tell us?

Inflation rises to 2.5% as prices pick up from their record lows in 2020. Increasing food and fuel prices drove inflation to its third consecutive month of growth in June 2021. Supply shortages and low prices a year ago can explain this month’s relatively high inflation.

Trade & supply chains

How is Brexit affecting the role of sterling in UK trade?

In the five years since the Brexit referendum, the share of the UK’s exports invoiced in pounds has declined, while invoicing in US dollars has grown significantly. Such changes matter for the competitiveness of UK exporters, particularly if there are sudden shifts in currency values.

News

School's out

As the summer term draws to a close, many questions remain unanswered about how young people can catch up on the learning losses from nearly half a year of school closures. Supporting education and skills – ‘human capital’ – is a critical area for UK policy-makers.

Jobs, work, pay & benefits

How can soft skills help people get better jobs?

Workers in low-wage jobs have fewer opportunities for training and limited pay progression. This can be improved by developing soft skills. National accreditation and improvements in digital infrastructure can help to upgrade people’s soft skills in the post-pandemic economy.

Schools, universities & training

Which investments in human capital will boost productivity growth?

Developing people’s knowledge and skills – their ‘human capital’ – is thought to be critical for improving productivity and sustaining economic growth. Empirical research suggests this link is surprisingly dubious, but measurement challenges may help explain this.

Schools, universities & training

How can UK policy-makers meet the increased need for tutoring?

Millions of children in the UK fell behind in their education while schools were closed in 2020. One-to-one tutoring is effective to make up lost learning, but costly. Offshoring online tutoring to lower-wage countries could allow for much wider access.

Data stories

UK GDP: Which sectors are thriving and which struggling?

In May 2021, UK gross domestic product grew for the fourth consecutive month, increasing by 0.8%. Pubs, restaurants and hotels jumped by almost 40% with cold weather acting as a boost for energy producers. Despite sustained growth, UK GDP is still 3.1% below pre-pandemic levels.

All Answers