UK economic output has fallen by roughly 30 per cent, according to new research, but some sectors such as manufacturing are much worse off than other areas like insurance and finance.
As coronavirus containment measures cause businesses across the country to close and demand to slump, the UK economy has slowed dramatically. Economists have struggled to put figures on the slowdown, however.
The Centre for Economics and Business Research (Cebr) today said it thinks the lockdown means UK output is down by 31 per cent. It is therefore only running at 69 per cent capacity.
The research, first outlined in the Sunday Times, laid bare the extent to which some sectors have all but stopped while others have seen smaller levels of disruption.
Cebr said production in the manufacturing sector is down 69 per cent due to the spread of coronavirus and measures to contain it. The research organisation said this is costing the UK economy around £500m per day.
In contrast, the UK’s finance and insurance sector has seen output fall by a smaller – although still chunky – 18 per cent.
One of the least-affected sectors is information and communication, where output has fallen seven per cent.
In both the information and finance sectors, it is much easier for people to work from home. Demand has stayed relatively high as, for example, computer use and online banking remain important.
Some sectors have been pummeled even harder than manufacturing, according to Cebr. The accommodation and food services sector has seen output fall 79 per cent, as demand for holidaying and housing collapse.
Economists now broadly think the UK is set for its worst recession since at least World War II.
Survey data last week showed that activity in the services sector fell at the fastest pace on record in March.
Andrew Wishart, UK economist at consultancy Capital Economics, said the British economy has entered “a recession of unprecedented scale and depth”.