The Organisation for Economic Co-operation and Development (OECD) predicts the British economy will shrink by 11.5% in 2020 due to the lockdown imposed since the first wave of the coronavirus pandemic, says Sky News. The New European reports that there is a potential for serious and large public disorder to emerge this summer, as the economic divide grows between the haves and have nots. The OECD adds that Britain will see the ‘worst’ economic contraction among developed countries. This subject is my broken record and I cannot get it out of my head.
We see restaurants like Las Iguanas, Bella Italia, Frankie and Benny’s, Chiquitos and Café Rouge likely to go to the wall. We learn also that Accessorize, Monsoon, Karen Millen and Oasis have either gone into administration or will be going into administration. And then there is aviation, where the New Economics Foundation (NEF) fears a jobs crisis on the scale of the coal mining industry collapse in the 1980s. This is happening at a time when some nine million workers are on furlough, their wages, or the bulk of them, being paid by the government. As the furlough scheme begins to be run down from August, a huge wave of redundancies are likely to be triggered. It is terrifying.
Even with the furlough in place, just look at the following job cuts:
- British Airways. Up to 12,000 redundancies.
- Virgin Atlantic. More than 3000 jobs to go.
- easyJet. 4000 jobs to go – 30% of its entire workforce.
- Ryanair. Pay cuts by a fifth and 3000 jobs to go.
- Rolls Royce. 9000 redundancies worldwide, 3000 in the UK.
- Bentley. 1000 jobs to go, a quarter of it workforce.
- BP. 1000 jobs to go worldwide, 2000 in the UK by the end of the year.
Then, there is the third sector, charities, where it is believed one in eight will go to the wall, especially the small, locally based charities. And let no one in the public sector believe the coming economic crash will not affect them. On the contrary, government borrowing will be at record levels. The pain will extend deep into the public sector. Every job lost in manufacturing will be reflected in the supply chain and it will extend everywhere. We will all see its effects in our lives.
The protests about racism, following the killing of George Floyd, would not appear to be connected to the coming crash, yet they will feed into it. The austerity Britons have suffered since 2010 has been felt most keenly by the more disadvantaged in society. Because of the inbuilt discrimination, prejudice and racism in our system, the BAME community are likely to suffer the most. When the furlough ends, when the government money taps are turned off, when the P45s are issued by the million, when people are fearful of being unable to meet mortgage repayments, when people fear they cannot afford to put bread on the table, when millions of people face a bleak future, whilst the illiberal elite at the top live in their own bubbles, insulated from the real world, driving off to their country pile when it suits them, effectively sticking a middle finger to everyone else, how will people react? With a sigh and a shrug and an endless queue at the Jobcentre? Or will they be angry? And if they are angry, how will they express that anger?
This is not me scaremongering. This is not project fear. The economic crash is happening as I write. Boris Johnson has said himself, “many, many jobs will be lost.” Chancellor Rishi Sunak has said, “I cannot save every job.” And yet, as I say day in and day out, no one is preparing the country for what is to come. Johnson’s breezy optimism has turned out to be nothing more than bluster and bullshit. But neither he nor Sunak talk anymore of a swift economic ‘bounce back’. Reality has well and truly pissed on Johnson’s fireworks. The would be king of the world is now the emperor with no clothes.
I live in an area dominated by various parts of aviation manufacturing and the well-fed behemoth that is the MOD at Abbey Wood. Many of my friends and neighbours are employed in these fields. These are good, well-paid jobs and if they go, in the midst of a recession, perhaps even a great depression, there will only be poor, low-paid jobs to go to and probably not many of them. Friends tell me they are scared. Lives and dreams are at risk. How could they not be? Add to this, automation is a long way down the tracks, replacing even more jobs, as well as vast technological developments. This has the potential to be a perfect storm.
Inequality could be the key to all this. Johnson regularly repeats Dominic Cummings’ ‘levelling up’ slogan, as if he is going to make the poor as well off as the rich. Even if he meant it – and I don’t think it’s any more meaningful than Donald Trump’s illusory ‘Make America Great’ nonsense – the state of the economy will probably make inequality far, far worse.
Of course, it’s entirely possible that we’ll get through the summer and beyond, peacefully and safely. It might be that the economic maelstrom will be quietly accepted. But what if the government acts to lockdown everyone in a working class estate but chooses not to lockdown the quiet, leafy affluent borough next door? Will everyone doff their caps and accept the better off sitting in their wine bars while the riff raff stay at home?
I’m not sure that Cummings’ soundbites alone will be enough to prevent social disorder. Only strong and clear action can do that. For an out-of-his-depth prime minister and his cabinet of the untalented, there is no chance of that.
