How is London’s recovery from Covid going? And what will happen next?

How is London’s recovery from Covid going? And what will happen next?

The summer’s end approaches, autumn is in the air and the next phase of the coronavirus crisis is getting underway. London’s schools start to fully re-open from Tuesday, after the Bank Holiday, and the government is to renew its encouragement for people to return to their former places of work.

At the same time, the near future looks forbidding for many Londoners, with major employers planning many redundancies and the government’s furlough scheme due to close at the end of October – Sadiq Khan has written to the Chancellor, Rishi Sunak, warning of the “devastating impact” if he does not extend the scheme, which he says covers nearly 1.4 million London jobs.

So how is the capital recovering so far and what will the key indicators be about how well recovery is going and in what ways?

The latest edition of London’s Economy Today, GLA economists’ monthly analysis of trends and new statistics, pulls together a number of important threads. It reports that across the capital as a whole there has been a growing amount of “recreational activity”, including visits to shops, social venues and, most notably, restaurants, nurtured by Sunak’s “eat out to help out” discount scheme. However, that popular measure is about to end and “a considerable reluctance to go out and do things” among Londoners is stressed.

The bulletin cites the Centre for Cities national high streets recovery tracker, which puts London firmly at the bottom of the footfall league table, with less than a quarter of its usual activity during July compared with its level before the pandemic – no wonder the Mayor and Central London BIDS are asking for encouragement tailored to the specific needs of the West End.

However, as Centre For London has shown in its latest Intelligence report, different parts of London are faring differently. Outside of the centre, some suburbs have actually been doing a little better than usual, seemingly because residents are shopping locally more than they were before.

The GLA team, rather like the Mayor in his letter to the Chancellor, observes that London’s labour market could be at particular risk then the furlough scheme ends. Already, “the growth in people claiming Universal Credit has been higher in London than in the rest of great Britain,” they write, “and higher for the under-25s than the over-25s.”

They also map sub-regional variations across the capital, showing that “it is more common for employees in an arc from the north west to the east of London to be furloughed than [in] other parts of the city”. King’s College professor Jonathan Portes is quoted: “While most London office workers can work from home, those employed in service sectors – cleaners and security guards, sandwich shop assistants and dry cleaners – generally cannot”. Put another way, for many Londoners the worse of Covid-19 may be yet to come.

A lot of Central London’s footfall problems are, of course, due to people’s anxiety about using public transport, especially the Underground. These riderships had begun to pick up by the end of July, but not by very much – this won’t surprise people who’ve been using the Tube lately. By contrast, use of other transport modes has got back to pretty where it was at the beginning of March. Centre for London shows (pages 27 and 28) that by the end of the first week in July, weekday car use was approaching what it was pre-lockdown and cycle use had matched it (along with some sharp rises at weekends).

There is much to be uncertain about. London Chamber of Commerce chief executive Richard Burge, perhaps better attuned to London office workers’ mood than 10 Downing Street, has today called for discussion around city centre economies to be “intelligent”.

He adds: “Office working and remote working both have their respective merits and a tribalistic pitching of one against the other isn’t helpful, particularly as the likely short-term option for many firms is a hybrid of both. As schools reopen and more opportunity for a return to central offices presents itself, let’s make sure the dialogue is as helpful as it can be. I’d far rather hear of how a company has achieved a safe return than simplistic statements about ‘get back to work’”.

It’s hard to predict what the next few months will hold and a great deal might change. In some ways, London’s coronavirus journey has only just begun. exists to provide fair and thorough coverage of the UK’s capital city. It depends greatly on donations from readers. Give £5 a month or £50 a year and you will receive the On London Extra Thursday email, which rounds up London news, views and information from a wide range of sources. Click here to donate via Donorbox or contact Thanks.


Categories: Analysis

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