An Economic Update
With the recent increase in the number of confirmed coronavirus cases and the introduction of further national measures to help slow the spread of the pandemic, many are left wondering what this second wave will mean for the future of the UK economy.
The picture so far
A decline in household spending between March and July of this year (when social distancing measures were first introduced) lead to two consecutive quarters of negative growth; the services sector experiencing the largest downturn in trade. The UK economy was in recession for the first time since 2009.
The property market remained buoyant with house prices rising across the UK since the market re-opened in May. This is largely due to low interest rates and a stamp duty holiday which applies to all homes up to the value of £500,000 until March 2021.
There was a sharp economic recovery in June and July, helped in part by the growing confidence in the reduction of reported coronavirus cases, the frustrated consumer’s appetite for spend and economic initiatives such as Help Out to Eat Out.
The economic recovery, however, has started to lose momentum. Following a recent surge in new coronavirus cases, a new tiered restriction system has been introduced with the most severe of the restrictions (Tier 3) having already been implemented in several cities across the UK. Whilst further national restrictions may be necessary to slow the spread of the pandemic they will also have an unwelcome impact on our economic growth.
Public support measures such as the Coronavirus Job Retention Scheme (CJRS) prevented a sharp rise in unemployment rates but as the CJRS comes to an end many businesses are already looking to make workforce adjustments. Recent statistics suggest that as many as a third of all UK employees are currently looking for employment; a figure which reflects the growing uncertainty amongst employees as to their long term job security.
What does this mean for my clients?
Whilst it is clear that some sectors have been more badly affected than others, we have already started to see a rise in the number of new enquiries from business owners needing restructuring and insolvency advice.
You can expect your clients to come to you, as their trusted advisors, for support and guidance and you can help your clients by making sure that they take the right advice as early as possible.
Whether insolvency is looming or the business needs to make some key restructuring changes in order to avoid insolvency, the earlier your clients get advice on the procedures and reliefs available to them the more chance they have of safeguarding the longevity of their business and minimising their personal liabilities.
How can we help?
At Thursfields we are dedicated to providing specialist advice, as the impact of Covid-19 unfolds, in order to assist you and your clients in planning for the future.
With years of experience in advising on restructuring and insolvency matters, our friendly team is perfectly placed to help you and your clients navigate these uncertain times.
For more information about how our Restructuring & Insolvency team can help you and your clients please contact Lauren Hartigan-Pritchard on 07936 950853 or email@example.com