COVID-19 Presented by UK Industry Analysts: Samuel Kotze John - - PowerPoint PPT Presentation

Presented by UK Industry Analysts: Samuel Kotze John Griffin 20th April 2020

Economic insights: COVID-19

COVID-19 Statistics

United Kingdom COVID-19 Statistics

1 10 100 1000 10000 100000 1 10 100 1000 10000 100000 1000000

Confirmed Cases (Log10) Total Confirmed Cases (Log10)

COVID-19 Containment Data

South Korea United Kingdom US Ireland Mexico China Germany Greece

• Poly. (South Korea)
• Poly. (United Kingdom)
• Poly. (US)
• Poly. (Ireland)
• Poly. (Mexico)
• Poly. (China)
• Poly. (Germany)

Latest UK figures 19th April 2020

• Total number of lab-confirmed

UK cases: 120,067

• Daily number of lab-confirmed

UK cases: 5,850

United Kingdom has exited the Coronavirus confirmed cases exponential growth phase.

United Kingdom COVID-19 Statistics 7th April

1 10 100 1000 10000 100000 1 10 100 1000 10000 100000 1000000

Confirmed Cases (Log10) Total Confirmed Cases (Log10)

COVID-19 Containment Trend

South Korea United Kingdom US Ireland Mexico China Germany

• Poly. (South Korea)
• Poly. (United Kingdom)
• Poly. (US)
• Poly. (Ireland)
• Poly. (Mexico)
• Poly. (China)
• Poly. (Germany)

Exponential case growth

United Kingdom COVID-19 Statistics 20th April

1 10 100 1000 10000 100000 1 10 100 1000 10000 100000 1000000

Confirmed Cases (Log10) Total Confirmed Cases (Log10)

COVID-19 Containment Trend

South Korea United Kingdom US Ireland Mexico China Germany

• Poly. (South Korea)
• Poly. (United Kingdom)
• Poly. (US)
• Poly. (Ireland)
• Poly. (Mexico)
• Poly. (China)
• Poly. (Germany)

United Kingdom COVID-19 Statistics 20th April

1 10 100 1000 10000 100000 1 10 100 1000 10000 100000 1000000

Confirmed Cases (Log10) Total Confirmed Cases (Log10)

COVID-19 Containment Trend

South Korea United Kingdom US Ireland Mexico China Germany

• Poly. (South Korea)
• Poly. (United Kingdom)
• Poly. (US)
• Poly. (Ireland)
• Poly. (Mexico)
• Poly. (China)

Exponential case peak reached

Government response

United Kingdom government response

Updated Government measures:

• 16th April: The government announced an extension of lockdown measures for at least

another three weeks.

Other developments:

• 8th April: The chancellor set out an extra £750 million coronavirus funding for frontline charities.
• 18th April: The government announced an £1.6 billion extra support for English councils.
• 20th April: The government unveiled a £1.3 billion package to support start-ups.

Economic indicators

United Kingdom GDP growth

Real GDP decline

• Real GDP forecast to decline by 35%

during first quarter of 2020-21.

• Steeper fall in output than during Global

Financial Crises (GFC).

• Faster recovery expected.
• Increased government borrowing

expected to spur a long-term increase in public sector net debt.

• 15
• 10
• 5

5 10 15 20 1908 1915 1922 1929 1936 1943 1950 1957 1964 1971 1978 1985 1992 1999 2006 2013 2020

Percentage change (%)

Real GDP growth

Actual OBR scenario

Unemployment

2 4 6 8 10 12 Nov-Jan 2000 May-Jul 2000 Nov-Jan 2001 May-Jul 2001 Nov-Jan 2002 May-Jul 2002 Nov-Jan 2003 May-Jul 2003 Nov-Jan 2004 May-Jul 2004 Nov-Jan 2005 May-Jul 2005 Nov-Jan 2006 May-Jul 2006 Nov-Jan 2007 May-Jul 2007 Nov-Jan 2008 May-Jul 2008 Nov-Jan 2009 May-Jul 2009 Nov-Jan 2010 May-Jul 2010 Nov-Jan 2011 May-Jul 2011 Nov-Jan 2012 May-Jul 2012 Nov-Jan 2013 May-Jul 2013 Nov-Jan 2014 May-Jul 2014 Nov-Jan 2015 May-Jul 2015 Nov-Jan 2016 May-Jul 2016 Nov-Jan 2017 May-Jul 2017 Nov-Jan 2018 May-Jul 2018 Nov-Jan 2019 May-Jul 2019 Nov-Jan 2020 May-Jul 2020

Unemployment rate (%)

United Kingdom Unemployment Rate

Actual Forecast OBR Scenario

Severe increase in unemployment

• New claims for universal credit made

between 16 and 31 March: 950,000

• Significantly worse than Global Financial

Crises (GFC) unemployment increase. .

• Unemployment may reach 10% in worst

case scenario.

• Recovery anticipated to be relatively quick,

barring exogenous shocks.

• Job retention scheme goes live 20th April.

Industries

IBISWorld’s most affected UK sectors

Industry Code (UK) Sub-sector

A Agriculture, Forestry and Fishing B Mining and Quarrying C Other manufacturing C10-C12 Food and beverage manufacturing C13-C15 Clothing, textiles and footwear manufacturing C16-C17, C22-C25 Material manufacturing C18, C26-C27 Electronics manufacturing C19-C20 Chemicals manufacturing C21 Pharmaceuticals manufacturing C28-C29 Vehicle & Machinery manufacturing D Electricity, Gas, Steam and Air Conditioning Supply E Water Supply; Sewerage, Waste Management and Remediation Activities F Construction G Other wholesale and retail G45 Motor vehicle wholesale and retail G46-G47 Food and beverage wholesale and retail H Transportation and Storage I Accommodation and Food Service Activities J Information and Communication K Insurance K Finance L Real Estate Activities M & S Professional, Scientific and Technical Activities N Administrative and Support Service Activities P Education Q Human Health and Social Work Activities R Arts, Entertainment and Recreation

Manufacturing

Manufacturing

Stifled Manufacturing

• UK manufacturers suffer by weak new orders and

supply chain disruption.

• Manufacturing PMI records steepest fall in output

since July 2012.

• Several manufacturers re-purpose operations

towards the production of medical equipment.

10 20 30 40 50 60 70 Feb-08 Jul-08 Dec-08 May-09 Oct-09 Mar-10 Aug-10 Jan-11 Jun-11 Nov-11 Apr-12 Sep-12 Feb-13 Jul-13 Dec-13 May-14 Oct-14 Mar-15 Aug-15 Jan-16 Jun-16 Nov-16 Apr-17 Sep-17 Feb-18 Jul-18 Dec-18 May-19 Oct-19 Mar-20

Index

Manufacturing PMI

Motor Vehicle Manufacturing

• Revenue growth:
• 2019-20: -8.3%
• 2020-21: -18.6%
• 2021-21: -11.0%
• Highly globalised nature of the industry

leaves it susceptible to coronavirus impact.

• SMMT forecast an 18% drop in output in

2020.

• 30
• 25
• 20
• 15
• 10
• 5

5 10 15 20 25

Percentage change (%)

Revenue growth

Transportation and Storage

Transportation and Storage

• Transport use down 60% for all transport

types compared with February.

• 95% fall in rail and tube passenger

numbers.

• Industries most affected:
• Urban Passenger Rail Operations.
• Intercity Passenger Rail Transport.
• Bus and Tramway Operations.
• Government support
• Temporary nationalisation of rail services.
• £400 million bailout for bus services.

Real Estate Activities

Real Estate

60 70 80 90 100 110 120 130 1/1/2010 5/1/2010 9/1/2010 1/1/2011 5/1/2011 9/1/2011 1/1/2012 5/1/2012 9/1/2012 1/1/2013 5/1/2013 9/1/2013 1/1/2014 5/1/2014 9/1/2014 1/1/2015 5/1/2015 9/1/2015 1/1/2016 5/1/2016 9/1/2016 1/1/2017 5/1/2017 9/1/2017 1/1/2018 5/1/2018 9/1/2018 1/1/2019 5/1/2019 9/1/2019 1/1/2020

Index (Base = 100 January 2015)

UK House price index

Residential sector

• Social distancing and virus fears limit residential transactions.
• Bank Of England bank rate changes mean many mortgages

have been revaluated.

• Mortgage repossessions generally halted by Financial

Conduct Authority.

• Residential house price stagnant in March.
• Major estate agencies expected residential property sales to

drop significantly.

• Property listing websites are reporting a significant fall in

residential property demand.

• House prices in the United Kingdom to decline in 2020

according to property experts.

Real Estate

Commercial

• Demand for warehouse space spikes since mid-March 2020. This

has mainly been driver by major supermarkets, online-retailers and pharmaceutical third-party logistic firms.

• Real Estate Investment Trusts (REITS) face fall in real estate capital

values as social distancing measure affect retail sales and subsequently retail property rental values.

• Office space less affected but not immune. Work from home has

driven technology integration which may reduce demand for office space in future.

IBISWorld COVID-19 Updates

COVID-19 Updates

IBISWorld Industry code IBISWorld Industry Title

C17.220 Sanitary Product Manufacturing in the UK C20.510 Explosives Manufacturing in the UK C21.100 Basic Pharmaceutical Product Manufacturing in the UK C26.200 Computer & Peripheral Equipment Manufacturing in the UK C29.100 Motor Vehicle Manufacturing in the UK G47.110 Supermarkets in the UK G47.710 Clothing Retailing in the UK G47.730 Dispensing Chemists in the UK H51.101 Scheduled Passenger Air Transport in the UK H51.102 Non - Scheduled Passenger Air Transport in the UK I55.100 Hotels in the UK I56.101 Full - Service Restaurants in the UK J60.200 Television Programming & Broadcasting in the UK K64.992 Factoring in the UK N79.110 Travel Agencies in the UK N82.200 Call Centres in the UK Q86.900 Diagnostic & Ambulance Services in the UK Q87.300 Retirement Homes in the UK SP0.068 Budget Airlines in the UK SP0.064 Online Travel Agencies in the UK

IBISWorld COVID-19 coverage

https://www.ibisworld.com/industry-insider/coronavirus-insights/