Business News Round Up (10/09/2021)
Perfect storm of glitches constrain UK economy
Severe shortages of raw materials, constrained labour supply and persistently high furlough rates are putting the UK economy in a vice, according to new official figures released today. The Office for National Statistic’s latest business insights survey shows almost one in three hospitality firms are finding it harder to recruit workers compared to normal times. One in four businesses reported higher prices for key inputs used in production processes, up from 21% in May, with half of construction firms noting increases in input costs. A staggering 67% of businesses said a paucity of suitable candidates to fill roles was putting the brakes on recruitment activity, with professional and scientific firms experiencing the most acute skills shortages. Despite figures released by the Treasury this morning showing the number of furlough workers had dropped to its lowest level since the onset of the Covid crisis, the rate at which people are leaving the scheme has slowed. 340,000 left furlough July, down sharply from 550,000 in June, prompting experts to warn Britain could face higher joblessness after the scheme winds down fully in just three weeks’ time.
More than a quarter of Scots feel more financially vulnerable since the pandemic
New research has revealed that more than a quarter of Scots felt more financially vulnerable than they did in March 2020. Mutual insurer Royal London surveyed 2,000 UK adults, finding that 31% attributed this vulnerability during the pandemic to a reduced income, while 13% had a lack of savings to fall back on. Other reasons included taking on more debt (13%), redundancy and job losses (11%). When thinking of the future and being able to respond financially to a change in life circumstances, just 17% of people in Scotland say they feel very financially resilient. In response, Royal London has committed £1.5m over three years to support 10 social enterprises – which are aiming to improve resilience and protect against life shocks – via its Changemakers programme.
https://www.insider.co.uk/news/more-quarter-scots-feel-more-24952606
UK launches data reform to boost innovation, economic growth and protect the public
The Information Commissioner’s Office (ICO) is set for an overhaul to drive greater innovation and growth in the UK’s data sector and better protect the public from major data threats, under planned reforms announced by the Digital Secretary Oliver Dowden today. One year on from the publication of the National Data Strategy, the government has today launched a wide-ranging consultation on proposed changes to the UK’s data landscape. As part of this, a new governance model is planned for the ICO, including an independent board and chief executive to mirror the governance structures of other regulators such as the Competition and Markets Authority (CMA), Financial Conduct Authority (FCA) and Ofcom. This follows the selection of John Edwards as the government’s preferred candidate as the new Information Commissioner, who is currently serving as the New Zealand Privacy Commissioner. Now that we have left the EU, the government wants to create a pro-growth and trusted data regime that unleashes data’s power across the economy and society, for the benefit of British citizens and British businesses.
UK on course to drop from Germany’s top 10 trading partners
The UK is expected to drop out of the list of Germany’s top 10 trading partners by the end of this year, official German statistics suggest. Germans spent £13.8bn, or nearly 11%, less on British goods in the first six months of 2021, according to data from the Federal Statistics Office. The UK has been in Germany’s top 10 trading partners since 1950. But with Brexit-related hurdles taking a toll, it looks set to drop to the 11th spot by the end of 2021. The UK left the European Union’s (EU’s) single market – which allows frictionless trade and the free movement of people between its members – at the end of 2020 after four years of wrangling. Since then, customs checks have been implemented, which have complicated trade. As a result, German companies have been looking to source goods from EU suppliers instead of UK ones – and this trend is increasing, an expert said.