The Resolution Foundation has reviewed the previous forecast and predicts that the UK economy is likely to be 6% smaller around Easter in 2021. The foundation says that lockdowns and restrictions will lead to depressed growth in 2021.
The impact of the coronavirus lockdown and restrictions
Even though an economic forecast was made for UK in November 2021, official forecasters warn that the new wave of the pandemic may lead to the economy being smaller in 2021's Easter by 6%. The Resolution Foundation has said that the national lockdown in Wales and Scotland, as well as the tier 4 restrictions imposed in most of England, would lead to a repressed growth until the incoming Easter. This might result in a 4.3% growth in 2021 compared to the 5.5% forecast made by the Office for Budget Reeponsibility (OBR).
Torsten Ben, the Thinktank Chief Executive states that by Easter the economy might be smaller than what was hoped for a month ago by 6%. He stated that efforts to contain the new wave of the pandemic could result in the first few months of 2021 to a tougher lockdown. He advised that the government should put in place stronger target support for all firms that have been affected and immediately enable workers needed to self-isolate access to the furlough scheme.
Predictions for 2021
Early 2021 is expected to be a lot more vulnerable than predicted in November 2020, when there was increased optimism about the approval of the first coronavirus vaccine that boosted both the stock markets and public confidence. Currently, more than half a million UK citizens have received the Pfizer/Biotech vaccine, with the majority being the largely advanced citizens of 80 and above in age, medical staffs, and care home staffs. It is expected that as the vaccines tool out, its wide spread will lead to a fast drop in deaths and a quick return to the mortality rate normalcy.