Economic Week In Review | Issue 238 | 20 July 2020

Employment

Employment levels fell by 649,000 (-2.3%) during lockdown, according to the latest figures from the ONS PAYE figures. The unemployment figure has not
seen a huge increase due to furlough, therefore economists have warned that Covid’s full effect on the jobs market will not be seen until October, when the
scheme ends.

Employment losses were greatest in April (-1.6%), however monthly growth has been negative since February.

UK News

• Consumer inflation increased slightly to 0.6% in June whilst a poll of
  economists had expected it to fall to 0.4%. Core inflation for less volatile
  elements rose by 1.4%. The large shutdown of the economy has hindered the
  index recently as some items have been unavailable.
• GDP | The UK economy grew by 1.8% in May. Whilst it is encouraging to see
  a positive figure, the economy is substantially smaller than at the beginning
  of the year and therefore needs larger figures to account for a recovery. The
  impact of reopening of non-essential shops should show in next month’s
  figures.
• Immigration | The Government released its latest guidance on a points-based
  system which confirms several specialist trades have been included on the
  Tier 2 ‘skilled worker’ list, but many more trades have not. The document also
  confirms fee levels which need to be paid as a license fee and an Immigration
  Skills Charge.

Global News

• Recovery in China | Exports from and imports to China showed an annual
  increase in June suggesting that the world economy is improving despite
  coronavirus still being active to varying degrees around the world. Despite
  June’s positivity, figures in China are still depressed for the first half of 2020.

Materials and commodities

• Material delays | Producers are “playing catch-up and haven’t caught up” with
  renewed demand, according to the Builders Merchants Federation. Supply is
  also being hindered by a lack of pallets as Scottish sawmills were closed. The
  CLC’s Product Availability Group has been meeting weekly to try and resolve
  pinch points.
• Tata steel is looking to replace its blast furnaces at Port Talbot with electric
  arc furnaces in an attempt to reduce carbon emissions. It is currently trying
  to obtain a government support package under which it will have to lower
  emissions and protect jobs.

Construction and property news

• Groundworkers | Demand for groundworkers is now above the pre-lockdown
  peak, according to analysis by Hudson Contract who suggest that it points to
  a V-shaped recovery.
• Gigafactory | Start-up company Britishvolt is to start construction on the UK’s
  first large-scale gigafactory at a former RAF base near Cardiff airport. The
  £1.2bn investment will provide batteries for electric cars.
• Future of mobility | The Mineral Products Association, whose members
  generally deliver building materials in large lorries have voiced concerns over
  plans to legalise e-scooters stating that they are less visible and less stable
  than cyclists.
• Furlough levels in construction have fallen from a peak of 40% at the end of
  April to 21% at the end of June.