Pandemic costs cities up to a years’ worth of high street sales

The coronavirus pandemic has cost businesses in city and large town centres more than a third of their potential takings and shut down thousands since March 2020.

According to Cities Outlook 2022, Centre for Cities’ annual economic assessment of the UK’s largest urban areas, central London is worst affected, losing 47 weeks of sales between the first lockdown and Omicron’s onset. Businesses in Birmingham, Edinburgh and Cardiff city centres are also among the worst hit, with all having also lost nearly a year’s worth of potential sales.

Across the 52 city and town centres studied, 2,426 commercial units have become vacant during the pandemic, against 1,374 between 2018 and 2020. In many prosperous city centres, lost sales are linked to an increase in business closures. In Oxford and Newcastle city centres the number of empty storefronts increased by around eight percentage points as sales fell.

Centre for Cities says that high streets in economically weaker places have been less impacted by the pandemic, suggesting that the government’s support successfully stalled the decline of many struggling high streets but was less effective in economically stronger places due to higher rents and a lack of custom from office workers.

That said, while stronger cities have borne the economic brunt of the pandemic, their higher levels of affluence mean that, if restrictions end and office workers return, they will likely recover quickly.

Andrew Carter, chief executive of Centre for Cities, said: “While the pandemic has been a tough time for all high streets it has levelled down our more prosperous cities and towns. Despite this, the strength of their wider local economies means they are well placed to recover quickly from the past two years.”

“The bigger concern is for economically weaker places – primarily in the North and Midlands – where Covid-19 has actually paused their long-term decline. To help them avoid a wave of high street closures this year the government must set out how it plans to increase peoples’ skills and pay to give them the income needed to sustain a thriving high street. Many of these places are in the so-called Red Wall so there is a political imperative for the government to act fast, as well as an economic one.”