Labour market recovery uneven, think tank warns

By William Eichler | 12 August 2021

Tourism-reliant areas, such as Cornwall, have seen job numbers pick up over the summer, but the jobs recovery is uneven and has a long way to go, according to a new analysis.

A new report from the think tank Resolution Foundation has found that the initial pandemic labour market shock and the recovery has varied according to the region.

Employee numbers are back to pre-pandemic form in many parts of the country. However, in some regions (most notably, London) the jobs recovery has a long way to go.

Titled Levelling Up and Down Britain: How the labour market recovery varies across the country, the report found that tourism-reliant areas, such as Cornwall, Gwynedd and the Causeway Coast and Glens, have seen job numbers pick up in recent months. In contrast, employee numbers in cities including Edinburgh and London continue to lag behind their pre-pandemic levels.

Resolution Foundation identifies two reasons for this. First, due to COVID-19, British holidays have been popular this summer, while home-working remains commonplace. People are not commuting to London and Cardiff as much now.

Second, higher-wage areas, like Westminster, Camden and Aberdeen, are also the places where the jobs recovery has been weakest, suggesting that residents are also not spending to the same extent as they were pre-COVID.

‘Whether or not this uneven recovery endures is an open question,’ the report concluded.

‘But a structural shift to more home-working or less commuting could have a lasting impact on the geography of the UK labour market, and a living standards effect to boot.’

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