Table of Contents
Overview
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- Key Takeaways
- Economic recovery gathering pace
- COVID-19 leads to substantial increase in public borrowing
- Bank rate at historic low
- Government support schemes prevent large rise in unemployment
- Inflation set to rise as some of the COVID-19 effects fade
- Business health
- Business investment takes COVID-19 hit
- Businesses are becoming more confident
- Insolvencies are down as government support measures help businesses keep going
- Special focus: utilities
- What’s next?
Economic Overview
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- UK economy shows resilience in Q1 2021
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- Figure 1: Annual GDP growth rate, 2015- 20, (Annual % change)
- Public sector borrowing – the substantial COVID-19 related increase
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- Figure 2: Public sector net borrowing excluding public sector banks, 2008-21
- Bank rate remains at historic low of 0.1%
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- Figure 3: Bank rate, 2008-20, by date of adjustment
- Inflation set to rise as some of the COVID-19 effects fade
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- Figure 4: Consumer Price Index, January 2020 - March 2021, (12-month Rate)
- Average wage growth remains strong, but data skewed by COVID-19 related changes in labour market
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- Figure 5: Real average weekly earnings, total pay, January 2020 –February 2021, (three month average % change year-on-year, seasonally adjusted)
- Unemployment rate expected to only rise slightly when job support scheme ends
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- Figure 6: Number of furloughed employments, 1 March 2020- 31 March 2021
- Figure 7: Coronavirus job retention scheme claims take-up rate, by sector, at 28 February 2021
Business Health
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- Business investment
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- Figure 8: UK business investment, £ million, Q1 2015 – Q4 2020
- Businesses are becoming more confident
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- Figure 9: ICAEW UK National Business ConfidenceTM index, Q1 2014 – Q1 2021
- Productivity
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- Figure 10: UK productivity measured by output per hour, Q1 2009 – Q4 2020
- Insolvencies are down as government support measures help businesses keep going
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- Figure 11: Registered company insolvencies in England and Wales, Q1 2018-Q1 2021
Special Focus: Utilities
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- COVID-19 lockdown restrictions lead to record low energy consumption in 2020
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- Figure 12: Consumption of electricity, by sector, 2010-20
- Figure 13: Consumption of natural gas, by sector, 2010-20
- Total household expenditure on energy
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- Figure 14: UK household expenditure on energy, 2011-20, (£ million)
- The economic contribution of the energy and water and sewerage sectors
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- Figure 15: GVA generated by the electricity, gas, steam and air conditioning supply sector, 2014-19, (£ million at current price estimates)
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- Figure 16: GVA generated by the water supply and sewerage sector, 2013-18, (£ million at current price estimates)
- Transition to clean energy drives capital investment in UK energy sector
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- Figure 17: Investment in the electricity and gas industries, 2012-19, (£ billion)
- Investment in water and sewerage industry
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- Figure 18: UK capital expenditure on water and sewerage services, 2016/17-2019/20, (£ million)
What’s Next?
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- Shift away from trade with the EU and towards non-EU countries
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- Figure 19: UK exports with EU and Non-EU countries, January 2020- March 2021
- Figure 20: UK imports from EU and Non-EU countries, January 2020- March 2021
- Economic recovery gathering pace, but longer term outlook less clear
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- Figure 21: Expectations of GDP annual percentage change, 2021-25
- Unemployment
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- Figure 22: Expectations of employment and unemployment, 2020-25
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
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