Ben Marlow:
The reopening of gyms, nail bars and even tanning salons is being touted as a watershed moment. It means the few remaining corners of the economy will be brought out of deep freeze four months after the lockdown began.
But it may prove to be another false dawn, in the same way the reopening of retail, pubs and restaurants has turned out to be a damp squib. The latest figures from the British Retail Consortium make for sobering reading. The high street hasn’t exploded back to life. Far from it.
Three weeks on from non-essential shops reopening, many are still deserted.
Yes, there has been an uptick from May, but shopper numbers were still 53pc lower in the second half of June compared to a year ago. Although that’s an improvement on the first half, when there was a 77pc fall.
As for “Super Saturday”, last weekend’s much hoped-for national booze-up was more like “Soggy Saturday”, and not just because of the miserable weather. Pubs traded at half pre-pandemic levels. Close to two thirds didn’t reopen at all, and only 12pc of restaurants flung open their doors, according to figures from accountancy firm RSM and the Coffer Group.
But the latest research from the Office for National Statistics really gets to the nub of it. According to a survey of 2,500 people, only one in five people feel comfortable eating out, suggesting that the taxpayersubsidised “eat out, help out” voucher campaign will have little effect. Meanwhile, one in 10 adults say they would visit the cinema.
The most popular reason to leave the home by a considerable margin continues to be shopping for basic necessities – three quarters of those who have left their home did so to buy food or medicine. But only one in 10 shopped for non-essential items such as clothes or furniture.
In London, this effect is multiplied because no one lives in the capital. Anyone who travels into the centre is doing so for work but, with everyone working from home, offices are empty.
Then there’s the tourism factor. Take away international travellers and commuters, and London has become a ghost town.
These numbers will terrify the Government. The Chancellor’s £30bn job support package announced on Wednesday means the Treasury has now showered close to £200bn of stimulus on the economy.
Yet the much-anticipated rebound hasn’t materialised, and doesn’t look likely to any time soon. Soon ministers will run out of firepower.
But the challenge may be more of a psychological one – making people feel safe. Despite all the expensive measures that businesses have spent weeks meticulously implementing, it’s clear that a large proportion of the population is either still too nervous to venture much further than the local shop, or doesn’t have much reason to as long as the home is the office.
That V-shaped recovery is looking increasingly pear-shaped by the day.
Stern words for Boohoo
“Inadequate in scope, timeliness and gravity”. Boohoo’s third-largest shareholder didn’t mince its words after dumping almost its entire stake in the online fashion chain as it fights allegations of modern slavery.
The move is another setback for the retailer after it sought to draw a temporary line under the affair with the appointment of Alison Levitt QC to undertake a review of its supply chain.
Aberdeen Standard Investments offloaded 27m shares worth roughly £80m, not massive in the context of a company still worth £3.5bn, but significant enough to send a powerful message that investors take these kind of allegations seriously these days, contrary to what cynics believe.
It is easy to dismiss the environmental, social and governance brigade as all talk and no trousers. Nevertheless, it’s a bold move by Aberdeen that helps to answer criticism of virtue-signalling.
Yet, one swallow does not a summer make. What would really force the board to take notice is if other Boohoo investors with ESG mandates followed suit.
Over to you Legal & General Investment Management, Man Group, JP Morgan and many others.
‘Last week’s much hopedfor national booze-up was more like Soggy Saturday’