10th January 2022
Bite-sized business news from the UK and beyond
Good morning Yesterday “London’s worst tourist attraction” closed after just six months. The Marble Arch Mound, a £6m artificial hill in the heart of the capital, was branded a “monstrosity” and a “disgrace” when it opened last summer. Despite the poor reviews it still had around 250,000 visitors.
New variant could cost economy £35bn
British fintech startup secures £110m investment
ECONOMYNew variant could cost economy £35bn
What’s going on?Staff shortages caused by Omicron illness and self-isolation could reduce the UK economy by £35bn in January and February, that’s according to analysis by the Centre for Economics and Business Research (CEBR).Why is this important?
This year the UK has recorded the highest daily rates of Covid infections with estimates that 1 in 15 people in England were infected during the festive period.The widespread prevalence of the virus has led to millions of people self-isolating, causing a wave of employee absences in the workplace.Isolation rules in England have come down from 10 days to 7 in the past month but there are growing calls to reduce this further to 5 days to ease staff shortages.A £35bn hit to the UK economy in the first two months of 2022 is equivalent to almost 9% of output during that period. A material impact for an economy still recovering from the ongoing effects of a 2 year old pandemic.The estimate by the CEBR is based on government assumption that 25% of the workforce will be absent due to Covid, that’s 9 times more than the pre-Covid average. A less dramatic estimate of 8% would cause a £10bn or 2.6% loss to the economy, the CEBR said.Nonetheless, it said it would expect that most of this reduction would be made up during the rest of the year.There are growing calls for Covid to be treated more like the flu i.e. with vaccination for only the most vulnerable and at risk, amid signs that Omicron is less severe than previous variants.
TakeawayAlthough Omicron is thought to be less harmful than other variants, its higher transmissibility has led to an overwhelming level of staff absences that is crippling many crucial sectors such as the education and the NHS. It’s likely that the government will look to revise the self-isolation rules to stop the economy grinding to a halt.
INVESTMENTBritish fintech startup secures £110m investment
Softbank Vision Fund, the world’s biggest tech investor, has taken a £110m stake in British fintech firm PrimaryBid, valuing it at close to £400m.PrimaryBid’s platform gives everyday retail investors access to companies raising money on the stock market. This is usually reserved for institutional investors like banks and pension funds. PrimaryBid’s vision is to democratise investing by putting retail and institutional investors on a level playing field. Founded in 2016, PrimaryBid flourished during Covid when interest in investing grew. It’s worked with more than 200 public companies that wanted to include retail investors when raising cash including Deliveroo and Ocado. The new investment from Japanese Softbank will be used to fund its expansion beyond the UK. The funding from Softbank is the latest in a series of investments it’s made into British tech firms. It’s backed the likes banking app Revolut, chip designer Arm and just last week invested $100m in meal prep company Gousto.
Stat of the day
The United Nations estimates that there were about 95,000 centenarians in 1990 and more than 450,000 in 2015. By 2100, there will be 25 million
Other stories to keep you in the loop
Labour calls for North Sea windfall tax to rein in soaring energy bills
One million to be pulled into higher rate of tax
Global chip shortage: Samsung expects its profits to jump by 52%
THG shares data on claims of ‘irregular trading of its shares’
Sainsbury’s to increase shop workers’ pay to at least £10 an hour
Jet2 boss says demand has returned to pre-pandemic levels
US jobs recovery stalls even as it chalks up record annual employment growth
Bitcoin prices fall to lowest in months after US Fed remarks
'It feels so wrong': For the first time ever, people in the UAE work on a Friday
Interesting links from around the web
How to stick to your 2022 goals and why most people fail
How I went from dropout to youngest ever Dragons’ Den investor
How Jessica Simpson almost lost her name