The UK economy suffered its biggest slump on record, shrinking by 20.4% between April and June 2020, as the country officially entered into recession for the first time in 11 years. We have estimated that the Coast to Capital region could lose up to 17% of Gross Value Added (GVA) during 2020. To recover that lost output and return to pre-COVID-19 GVA levels by 2029, regional GVA growth would need to at least double to 6% by 2026.
Coronavirus (COVID-19) Economic Impact Assessment
We have produced our COVID-19 Economic Impact Assessment to examine in detail the full range of economic impacts for the region. We have structured this using the 5 Foundations of Productivity – Ideas, People, Infrastructure, Business environment and Places. This builds directly onto the extensive evidence base developed in preparation for a Local Industrial Strategy, prior to the pandemic. Together these form the basis for economic recovery planning for our region.
The full report is available to read here. A summary of the headline findings can be found below.
The impact of COVID-19 has proven to be particularly targeted on our areas of economic strength, meaning that parts of our economy appear to be among the most disproportionately affected in the country.
- Estimates suggest our regional GVA could shrink by between 12% to 17% in 2020, compared to UK averages of between 11% and 15%
- If a second lockdown occurs, our GVA could contract by 26% in 2020
- An estimated 1 in 4 businesses (c.22,500) had less than 3 months of cash reserves in July
- Corporate insolvencies are increasing in volume – 74 companies were declared insolvent or liquidated in June compared to 39 in May
- Reigate and Banstead is the only district within Coast to Capital to have a higher than national average rate of COVID-19 cases
- As of July, just over 100,000 jobs have been furloughed in the districts and boroughs around Gatwick airport
- 34% of our working population are currently on Government employment support schemes and we have already seen a 150% increase in claimants since March 2020
- Crawley has had the greatest impact with 44.2% of the working population affected.
Other COVID-19 research
Several of our partners across the region have also undertaken local research into the impact of COVID-19:
- Gatwick Diamond Initiative – COVID-19 impact assessment
- Coastal West Sussex Partnership – COVID-19 impact assessment
- Greater Brighton Economic Board – COVID-19 impact assessment
- West Sussex County Council – Economy Snapshot
To follow our work on economic recovery planning please subscribe to the Coast to Capital newsletter