“The Bank of England releases a relatively upbeat outlook given the risks ahead” says Yael Selfin, Chief Economist at KPMG UK.
“While the projections outlined in today’s report depict a stark picture for the UK economy, some of its assumptions around the return of furloughed employees to work in the fourth quarter seem optimistic. The cloud of a second wave and further localised lockdowns is likely to keep many businesses in sectors such as hospitality operating at reduced capacity at best, unable to bring back a large share of their workers.
“The end of the transition period between the UK and EU is also likely to see delays in investment this year, with some inevitable friction in trade in the first half of next year pulling down growth. .
“The report emphasises the need to upskill workers who will be losing their jobs, especially those that are less skilled. Government needs to pivot its support from a blank wage subsidy to furloughed workers, to an active programme that will enable workers to be more flexible and ready to access new jobs.”
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