Big Blow for Businesses: PM delays lockdown lifting date
July 1, 2021
3 min read
What's going on here?
The highly anticipated 21 June has been postponed by 4 weeks to 19 July, as the PM announces a new potential date for the end of all Covid restrictions
What does this mean?
This means that social distancing measures will remain in place until 19 July, with a potential lift on 5 July, if the data supports it. This decision comes following a surge in cases of the Delta variant, and hospital admissions slowly rising. The government’s primary aim is stopping the spread of the new variant overwhelming the NHS, and it hopes this next few weeks will allow for a final vaccination push, with the announcement coming just days before vaccines opened to everyone aged 21+. Foreign Secretary Dominic Raab insists that the government wants this move out of lockdown to be for good, and is reluctant to keep ‘yo-yo-ing in and out of measures’ – which is something we can all agree on!
However, this leaves many businesses continuing to feel the major financial effects of Covid restrictions. Offices have now had to rethink any return to office plans, hospitality venues are forced to hold fire on operating at full capacity, and clubs and festivals, some of which had splashed out on big comeback events, continue to wait.
What's the big picture effect?
The news was particularly devastating for those reliant on the night-time economy. For example, nightclubs remain among the hardest hit during the pandemic, with most having now been closed for 15 months. A further four-week delay with only a week’s notice came as a huge blow to struggling clubs who had made financial commitments to organise sold-out reopening events. As a result, 95% of night-time economy businesses’ survival is hanging in the balance, as many were relying on these to bring in a hefty profit.
An estimated £3bn is expected to be lost in sales due to the push back, as well as over 300,000 jobs potentially at risk. Pubs alone are set to lose around £400m over the next month, despite the boost in sales from the Euro matches. With social distancing meaning no crowded pubs, or even standing at the bar, many pubs have only been able to welcome a fraction of their usual number of customers.
On top of this, from 1 July companies are expected to contribute 10% to furlough salaries, despite calls from the Federation of Small Businesses to delay the tapering of the scheme. While the number of those on furlough pay has drastically dropped over the past year, in places such as Bristol, where over 1/3 of the population work in nighttime economy, many businesses will struggle to afford these contributions, resulting in further job losses. The end of the month also marks the quarterly rent due date, and while the ban on commercial evictions has been extended to March 2022, up to £6bn in rent is still owed by tenants.
However, it’s not all doom and gloom. An experiment in Liverpool back in April, where partygoers attended a rave with no masks or social distancing, showed that a spike in infections can be avoided with the correct testing. This gives some businesses a glimmer of hope that they can soon open fully and safely. In the meantime, the likes of restaurants, bars, and pubs continue to operate with measures in place, but those of us looking for a long-awaited club night out will have to hang on just a little longer.
Report written by Lotanna Okaro
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