UK must cash in in on upturn

A YEAR after the first lockdown and with over half the UK adult population now vaccinated there is light at the end of the Covid tunnel.

But what next? We are surrounded by the same challenges we faced before lockdown: potential trade wars with China and disputes with Europe in a post Brexit world.

Of more concern is the fact we now also have a huge bill to pay for the Covid storm.

One thing for certain is that there will be a recovery. As the UK economy is nothing if not resilient, but the starting point is very low.

I say this with a heavy heart as last year the UK economy contracted by nearly 10 per cent which was the largest contraction since the ‘Great Frost’ of 1709, though the world was very different almost 300 years ago.

The UK has been kept afloat using the usual levers of fiscal stimulus of not increasing the tax burden to pay for increased borrowing, and monetary policy pumping eye watering sums into the economy.

The growth rate for the economy has been forecast to be between 5-6 per cent. If the forecasts are even half true, it could mean we outperform Europe.

This means UK plc has to be ready to capture this spurt of economic growth and turn it into something tangible. It is incumbent on all bosses and the financial sector to ensure firms start look at new prospects which they are able to exploit.

The UK is the eighth biggest manufacturer in the world so we must use that investment to cut through and improve productivity by new methods of working learnt during the pandemic.

There are also new export opportunities given that a lot of businesses who previously traded with Europe have to consider ‘on-shoring’ elements of production to preserve efficiencies.

A lot of employees harbour visions of starting up their own firms because they know they can improve on what they have learned from their employer. It is this entrepreneurial spark that needs to be nurtured.

Investment within businesses and support for employees will reap dividends, especially added to new ways of working to increase productivity.

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