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Abstract:

CEP Covid-19 analysis
The impacts of Covid-19 and Brexit on the UK economy: early evidence in 2021
Josh De Lyon and Swati Dhingra
May 2021
Paper No' CEPCOVID-19-021:
Full Paper (pdf)

Tags: covid-19

We use real-time firm survey data to describe trends in the UK economy in early 2021. As of April 2021, business activity and expectations for the future have improved. However, real wage growth is down and firms are reporting that average input costs have increased. Firms are reporting that Brexit has affected their operations, leading to a fall in exports to the EU for a quarter of exporters and a fall in imports from the EU for a third of importers. Increased border costs are the most cited Brexit-related issue. We discuss how policies can support workers and firms in adapting to the structural changes from Covid-19 and Brexit.