Certain Covid changes here to stay, says Bank of England
Image credit: REUTERS/Kevin Coombs
The governor of the Bank of England has said he believes investment in intellectual property will remain high even after the pandemic and that people are “adaptive creatures”.
Andrew Bailey, the Bank's governer, said he believes that people are “adaptive creatures”, so many changes that have come about because of the Covid-19 pandemic are unlikely to go away any time soon.
“We do see already evidence of a shift to labour-saving use of digital technology, which in itself raises measured productivity growth,” Bailey told the audience at an Organisation for Economic Co-operation and Development conference.
“Probably the best example, certainly in the UK, of that is retailing. We saw a 10 percentage point increase in the share of online retailing last year,” he added, also noting that the previous 10-point increase had taken seven years.
“Investment in intellectual property products, things like software and research and development, (is) holding up better than other forms of investment. Now the big question – to which, of course, it’s too soon to provide any firm answer – is to what extent are these changes going to persist and further expand?
“My best guess, for what it’s worth, is that I think that to some considerable degree they will, because we are essentially all adaptive creatures.”
Evidence has emerged to suggest that the UK’s bounce back from Covid-19 is slowing. Figures from the Office for National Statistics, issued today (9 July), show that gross domestic product (GDP) only grew by 0.8 per cent in May, down from 2.3 per cent in April.
Bailey said innovation in the economy requires both success and failure. He pointed to the successful vaccines being rolled out across the world, but added that there were many attempts to develop a Covid-19 vaccine that did not work.
Aside from the exponential growth in remote working dictated for millions of people by the pandemic, the UK population has also absorbed a variety of societal changes and behaviours over the course of the last 18 months.
Last month, Ofcom’s Online Nation 2021 report, which spanned a full 12-month period, revealed that UK adults had spent more time online than most of Europe. The report found that UK adults spent more than three-and-a-half hours (217 minutes) online each day in 2020, more than an hour longer than in Germany and France and 30 minutes more than Spain.
Planning ahead for this summer, in June EE announced a boost to its 4G and 5G network capacity in some of the UK’s most popular coastal locations ahead of an anticipated rise in ‘staycations’, as travel restrictions encourage more holidaymakers to enjoy more local attractions.
In light of the severely curtailed options for travelling abroad, last month the UK government announced a new rail pass for domestic holidaymakers, intended to boost the recovery of the native tourism industry.
Meanwhile, the public reacted enthusiastically with record numbers of downloads of the NHS app after the addition of a 'vaccine passport' feature. More than 2.7 million people downloaded the NHS app after it added this feature, which displays Covid-19 vaccine status.
This new feature came ahead of the vaccination programme being opened to younger adults. To encourage more young people to get vaccinated, and to counter the dangerous undercurrents of anti-vaccination misinformation online, social media giants Snapchat, Reddit, TikTok and YouTube partnered with the government and the NHS to encourage more young people to get vaccinated.
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