We are now rapidly heading towards the middle of July. It would be nice to say that we have moved on to a more certain place from where we all were a couple of months ago but it really doesn’t feel that way at present.
The uncertainty over the ongoing presence of the virus and worries over an increase in cases on a more national level, as well as local, are definitely overshadowing a lot of the attempts to get decent and sustained traction to move forward on the economic and social front. Certainty, in terms of future planning from holidays to going back to the office, is a luxury not yet open to most of us.
Before I go on to look at some of the economic fallout, I want to make clear I am only too aware of the human impact from corona virus. Stopping people getting ill is the all important objective at the current time. What impact the events of 2020 have had on the nation’s mental health waits to be seen. The statistics are grim reading.
I was listening to an interview a few days ago from a senior member of the one of the major banks who was eager to make the point that not everyone or every business sector has had a ‘bad’ pandemic. I don’t think he was trying to belittle the impact for those who have had loved ones die or who have been seriously ill but was trying to view the whole thing from a business perspective alone for the purposes of the interview. In the relentless stream of doom and gloom from the news it is sometimes easy to forget some business sectors have been having to react quickly to huge upturns in demand for their products or services.
The banker identified several sectors, such as the pharmaceutical and food retailing sectors, that have had the equivalent of a boom time caused by the impact of lockdown and all that went along with the behaviours we witnessed. Some of those benefiting are also smaller businesses, such as our local corner shop, who saw a 400% rise in turnover during April through to June. Some other businesses, not quite so predictable at the start of the pandemic, have also had good news stories. Let me take a couple as an example. ‘Pets at Home’ had been targeted by speculators before Covid-19 who viewed at as a vulnerable business. The demand for their products rocketed during the early stages of lockdown (probably down to stockpiling), they have paid a dividend and the vultures moved on elsewhere.
Likewise, Halfords offset reduction in demand for some of their products with a huge surge in demand for bikes, which continues to this day. This is a bit odd when you first think about it until you remember the gyms were shut so people were desperate to find other ways to exercise. Both ‘Pets at Home’ and ‘Halfords’ were able to stay open during the worst of the pandemic lockdown which makes me wonder what other strange phenomena in terms of demand for services and products we may have seen if other outlets had been in similar situations.
Working in the legal sector we saw a very mixed pattern emerge. Areas such as wills and probate saw a lot of activity, family law was busy and interestingly so were dispute resolution. People put together for long periods of time cause conflicts and the wills and probate surge were just a sad outcome of the times. Residential property also remained remarkably active and resilient given the conditions and has surged since.
Hospitality, event management and the wider retail sector has had and continues to have an awful time of it. Anything that involves people gathering in numbers is now vulnerable. The thought of something like the Cheltenham Gold Cup or a major football competition being allowed to go ahead is unthinkable for the foreseeable future. There is only so much anyone can do to offset that risk. I can’t think of a silver lining for that side of things at this time outside the pubs tentatively reopening.
The airlines and transport sector (and related manufacturing industries) in general make the hospitality sector look like a happy place in comparison at the moment! I won’t go there in this article. With all these things, we never forget that it is people’s jobs and livelihoods which are at stake.
This is just a bit of a ‘pit-stop’ to consider what we have learnt so far from what happens when a pandemic comes to town. Some areas of the economy thrive whilst others are hit badly. It is obviously an unfolding and ongoing story across the board. Also, people don’t always behave as you think they might. If we get a second wave they will also be behaving based on what they all learnt from the first wave, so you may see other patterns develop. Saying that, don’t run down your toilet roll stocks just yet!
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