Despite it looking like the Omicron Covid variant is going to be less dangerous to health than its forerunners – according to the World Health Organisation, the European Centre for Disease Prevention and Control, and Dr Angelique Coetzee, chairman of the South African Medical Association, who first encountered it – it is nevertheless wreaking total havoc.
The FTSE has been all over the place this past few days. It seemed to go into freefall on Friday: traders’ screens turned bright red as more than £65bn was wiped off the FTSE 100 alone. London’s leading index closed a shocking 3.6% lower – its worst day this year – as investors panic sold. British Airways owner IAG led the decline, with shares plummeting some 20% in value. On Tuesday, the FTSE 100 again dipped below the totemic 7,000 mark, and what little recovery there has been since has been jittery, to say the least. All it took was for the boss of covid-vaccine manufacturer Moderna to tell the Financial Times that existing vaccines are unlikely to be as effective against the Omicron variant as they’ve been against the Delta strain, and the world went into meltdown.
My WhatsApp feed is currently full of messages about cancellations. Christmas parties, school nativity plays, big outings, travel, and holiday plans – all now off. Opinion is divided between the furious, who can’t believe yet another new yet less dangerous variant is spoiling their fun and delaying a return to normality, and the fearful, who want us running back into a full lockdown the day before yesterday. What is clear is that the resurgence of the dreaded government press conferences and the reintroduction of mask wearing in shops and on public transport has massively upset our economic and social equilibrium. Again.
Also, once again, right up there at the front of the firing line is retail. The news that Black Friday and Cyber Monday discounts have failed to boost High Street sales is not good news. Retail footfall is still down 14.5% compared to 2019 levels, before the pandemic hit. Given that 53% of us in employment continue to work from home for at least part of the week, the lack of international tourism, and a move to online shopping exacerbated by lockdowns, perhaps that statistic is not surprising.
The High Street was failing long before covid because of the expansion of out-of-town centres with easy parking, rising business rates, and online shopping. According to retail data analyst Springboard, even without the impact of covid, footfall in our high streets would still be 3% lower now than the 2019. There can be no doubt, however, that covid has massively exacerbated the issue. Nationwide, one in five shops now stand empty in urban shopping centres, which have been the worst hit, according to the British Retail Consortium. Of the big names, we’ve lost Debenhams, the whole Arcadia Group, which included Topshop and Miss Selfridge. The Edinburgh Woollen Mill has gone. Several John Lewis’ outlets have closed, and so the list continues.
However, there is some good news. The high street isn’t dead yet, far from it, and consumer spending is vibrant. Shoppers reportedly spent one-fifth more than last year on Black Friday deals: the number of payments via Barclaycard were up 23% between midnight and 5pm compared with the same period in 2020, when most of the UK high street was in lockdown, and up 2.4% on 2019. Nationwide meanwhile said its customers had made £5.95m in purchases by 5pm, 26% up on last year and 24% up on 2019.
The question is: how much do our local and devolved authorities and national government value the High Street? And how much effort are they prepared to put into its revival? My personal view is that post-covid, they should throw everything they’ve got at it, as it could well play a vital role in reenergising and bringing together a fearful, angry, divided society. It will require a massive, strategic effort by both retailers and the authorities, but revival is possible. Nothing beats the actual shopping experience, that hands-on, personal service and human interaction you get in your local shops. You can’t get that online and, being human, many of us have sorely missed that these past two years or so.
Our message to business: Key here, we think, is to not overreact to every new covid scare and carry on what you’re doing with the support of your colleagues and clients. And get out there and support our great British high street!