UK ‘officially’ in Recession
Chancellor Rishi Sunak has confirmed that the UK is now officially in recession. UK economic output shrank by just over a fifth (20.4 per cent) this year – said to be the biggest slump for the UK in the context of the global economy.
The impact on Northern Ireland is inevitable. As part of the UK, with specific issues around Brexit, trade and borders – as well as Covid to contend with – many retailers have been hit hard in recent months. Ironically others have fared well, as shoppers opt for the comparative safety of their local independent convenience store.
Retail NI has warned that the high street is not facing a crisis – but an emergency. It has welcomed the NI Executive’s promised task force to tackle the demise of the high street.
There are fears that when the Government’s furlough scheme ends in October, there’ll be a further wave of redundancies. Less cash in the pocket means less spending power for ordinary people. The trickle down effect could be more difficult than previous recessions.
Schemes such as the Government’s Eat Out to Help Out reportedly paid for 10.5 million meals within the first week, yet it’s just a ‘sticking plaster’ approach. The scheme only lasts for one month. Customer loyalty is not guaranteed.
Covid and Brexit could deal business in Northern Ireland with a double-whammy. Ironically, one area that appears to be holding up firmly is in the convenience sector – with symbol groups in particular weathering the storm.
“It’s been a double edged sword,” Judith Mercer of the NFRN told NR. “While some were able to remain open throughout, and saw increased sales of certain items, others had to close for the duration. Sadly a few may not be able to re-open, especially those located in places like Belfast city centre that rely heavily on footfall.”
Easons was just one Northern Ireland chain to cease trading, with WH Smith also announcing wide spread redundancies and restructuring.