A business specialist has warned that the country’s economic conditions will get worse before they get better.
Professor William Rossiter, an associate professor and economist at Nottingham Business School, said job losses will increase and many struggling companies will go under before the impact of the Covid-19 vaccine takes hold.
He spoke to Nottinghamshire Live about the challenges ahead following an unprecedented year for business, with the economy still reeling from the first lockdown last spring.
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Prof Rossiter said: “What we’ve seen is the economy falling off a cliff in March when the Government introduced the first lockdown.
“When most places came out of lockdown in May/June time things started to recover. We had Eat out to Help Out which helped some sectors over the main part of the summer.
“But after we came into autumn we’ve seen a resurgence of Covid cases which I think created a lack of confidence understandably in the business community and elsewhere.
“And that recovery slowed markedly. And of course we’ve had the latest set of national restrictions. It’s very likely the most recent lockdown will not have had anything near to the impact we saw during the first.
“The impact associated with that lockdown probably won’t be as great, but of course a lot of businesses were already reaching the end of their tether, particularly in the hospitality and leisure sector.
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“A lot of them haven’t operated in six months and there is only so long that some of them can survive without income.
“I do think there is a sense in which businesses whose trade has been significantly restricted will only be able to survive so long.”
While some experts have predicted the new vaccines could mean life returns to some sort of normality by spring or summer, Prof Rossiter has warned against believing all economic problems will be quickly solved by the vaccine.
He said: “I think it’s important not to overstate the likely impact that will have, particularly because of the timescales it will take to be rolled out to the wider population.
“Welcome though that is, it’s not going to rapidly change the business environment for quite some time.”
Prof Rossiter predicted unemployment will continue to rise – having nearly doubled since the start of March.
A lot of industries, such as commercial air travel, could take years to return to pre-pandemic levels, he said.
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“Concerns for Nottinghamshire specifically relate to some of the important local employment sectors where we are looking at quite a big recess potentially, retail being the obvious example. Also food services.
“These are sectors that are very reliant on face-to-face interaction for sales. We do seem to be seeing some quite important structural change, a shift to online for retail. And one would have to be concerned I think about the future of sectors like that.
“It’s hard to know what is permanent but I think it seems likely we’re going to see some pretty major restructuring, we’re starting to see that now.
“What is going to happen to the vacant premises of those that disappear completely? In Nottingham, an awful lot of retailers around the city are quite reliant on office worker footfall. If office workers aren’t working in offices, that’s bound to compound the problem.”
He used the example of Broadmarsh shopping centre site as a development which could move away from being retail-focused, with new plans to transform parts of the centre into green spaces.