As the nation comes to terms with the new lockdown restrictions that will be in place for a month from 5 November, the Treasury has announced an extension to the emergency business loan scheme. What does this mean and who will benefit from it?
What Does This Involve?
The return to lockdown restrictions in the UK has led to fresh predictions of the amount of economic damage being made. What do the Bank of England (BoE) experts think about it and how is the furlough scheme going to be extended to help people cope?
What Does the BoE Think?
The hopes that a coronavirus vaccine will be available by the end of 2020 has led to the financial markets receiving a boost that led to rising share prices. Yet, the latest employment news is less promising, with a dramatic fall in the number of people in work.
The Employment Details
This information comes from the Office for National Statistics (ONS), who report that the number of people in employment dropped by 247,000 in the period from July to September when compared to the same months last year.
As the country battles to get through the second wave of coronavirus infections, new data suggests that the restrictions currently in place are proving to be less damaging to the economy than the spring lockdown.
The Early Signs
A range of different indicators show us that economic activity has been less badly affected than during the earlier lockdown. These include the number of people going to work and the volume of heavy goods traffic around the country.
Chancellor Rishi Sunak will carry out a UK spending review next week, and analysts fear that it will continue bleak data. Indeed, the government’s spending plans could be seriously hampered right up until the next election, in 2024.
Further Details
Advances in the search for a Covid vaccine and increased clarity over the US election results have helped to push many financial markets into positive numbers, although current studies show that business confidence has plunged in some European countries.
Details of the Market Situation
Chancellor Rishi Sunak this week announced another huge investment to help deal with the coronavirus crisis. £55 billion will be pumped into the economy to try and tackle the UK’s biggest financial slump in more than three centuries, yet he has pointed out that this is just the start of the current crisis.
The Full Extent of the Borrowing
The Organisation for Economic Co-operation and Development (OECD) recently released its latest prediction for how different economies around the world will recover from the current crisis. Among the bad news is the fact the UK is behind only Argentina in terms of the negative effect to be felt.
The Full Details of Their Report
The furlough scheme that started in the UK in March 2020 is to be replaced by a Job Support Scheme (JSS), chancellor Rishi Sunak has announced. This is one of a series of measures that are designed to protect British companies and employers while coronavirus restrictions remain in place.
Details of the New Scheme
The JSS initiative announced by Sunak will directly support the wages of workers who continue to carry out a minimum of a third of their usual working hours. Their companies will pay them for the time that they work.
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