Britain’s economic recovery began to slow in July as the ‘pingdemic’ kept workers and shoppers stuck indoors.
Activity in the dominant services sector, which includes industries from banking to retail, grew for the fifth month in a row, as Covid restrictions lifted.
But the rate of growth was the weakest since March, at the end of the winter lockdown, as staff shortages squeezed supply.
Britain’s economic recovery began to slow in July as the ‘pingdemic’ kept workers and shoppers stuck indoors
Close to 700,000 people were pinged by the NHS Covid app in the week to July 21 alone. Many forced to self-isolate have received both their vaccines, or turned out to be healthy, but still have to stay off work for up to ten days.
The app has hurt sectors such as retail and hospitality and many businesses have been forced to close again. In the latest data on shopper numbers from analyst Springboard, visits to UK shops fell 24.2 per cent in July from the same time in 2019.
The services business activity index from IHS Market dipped to a reading of 59.6 in July from 62.4 in June. A score above 50 indicates growth. Businesses’ woes were compounded by costs rising at the fastest level in 25 years.
Companies had to pay their staff more, to convince the few workers available to join. Some have been offering big bonuses, hoping to lure more workers. Care home operator HC One is offering a £10,000 ‘welcome bonus’ on two jobs for night nurses, both in Scotland.
Duncan Brock, at the Chartered Institute of Procurement & Supply, said: ‘We suspect the best of the post-pandemic recovery could be behind us, especially if higher leisure and hospitality costs diminish appetite for spending.’
The rising prices could be a worry for the Bank of England, which is trying to balance the need to keep a lid on inflation. Its rate-setting Monetary Policy Committee is due to announce the outcome of its latest meeting today.
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