Due to the high demand for care home services, economic productivity, or Gross Value Added (GVA) among care homes is likely to be the highest of 15 industries by the end of the year, rising by 6 per cent. This compares to the food service industry, which is expected to lose around 37 per cent of its economic productivity by the end of 2020, compared to pre-COVID levels.
A report by Ernst & Young originally predicted UK GDP to grow by 1.2 per cent in 2020. Instead, due to COVID-19, it is set to contract by 6.8%. Although this paints a bleak picture right now, there is hope for the latter part of 2020, with forecasts suggesting the economy will slowly start to recover in July (Q3) as restrictions relax.
Looking at GVA by regional activity as a whole, analysis shows London’s GVA is set to be the least affected due to its extensive service-based economy and remote workforce, and the West Midlands the most.
Looking at the analysis, John Williams, head of marketing at The Instant Group said: “The good news is the scale of recovery across most UK regions in 2021 will be similar to contractions in 2020, indicating that as most sectors start to recover, local economies could make up for lost ground. The economy is not set to return to its 2019 size until 2023, however slow bounce back is expected across the board as consumer demand increases post-COVID-19.”
For more analysis of the care home business, see our May/June Buying & Selling feature.