The UK's economy is set to plummet again, long before it's had a chance to recover from the recession caused by the first lockdown in March.
Shutting all non-essential shops, restaurants, hotels and more, travel restrictions and closing schools saw Britain's economy plunge a record 18.8% in the second quarter of 2020.
Since then it's been struggling to recover - rising 16% from those lows as restrictions were eased over the summer.
But even that growth left the UK 8.6% below where it was at the end of 2019.
Now, with a new lockdown coming into force, it looks certain the economy will plunge again.
“This is bad,” Ludovic Subran, Allianz SE chief economist told Bloomberg Television.
“The UK is a service economy, so it’s all about shutting down services, and it’s bad because things like schools are a big part of GDP. Also because they play a role in how much parents are able to work.”
The new lockdown shouldn't cause as steep a plunge as the last one - if only because it's fall starts from a lower level with the travel, tourism and hospitality industries still not back to where they were at the start of March - but it means chances of a quick recovery look remote.
Worse, the new lockdown comes just as Brexit changes are beginning to be felt - with the UK Government itself predicting Boris Johnson's deal will knock 4% from the nation's output - which addressed trade in goods, but not services.
Alex Altmann, a partner at accountancy firm Blick Rothenberg, said: “The UK economy earns 80% of its GDP with services, not with goods, and unfortunately there this is not much in the trade deal for the vital UK services industry.”
He added: “Also, a ‘zero-tariff’ trade deal does not mean ‘zero customs regulations’ and the additional red tape for traders selling into the EU will have to be paid by someone. This is a bad day for the UK economy and will cost key industries billions in the years to come.”
