Big cities lose nearly a year’s worth of high street sales in pandemic cost: report

A man walks through Fort William Main Street as people have been asked to stop traveling to the Scottish Highlands in a bid to avoid spreading the coronavirus on March 22, 2020 in Fort William, Scotland. (Photo by Jeff J Mitchell/Getty Images)

Businesses in city and large town centres have lost more than a third (35%) of their potential takings since March 2020, a new report has found,

The annual Cities Outlook 2022 by research and policy institute Centre for Cities has also found that more than 2,400 city and town centre units have become vacant so far during the pandemic.

Central London, Birmingham, Edinburgh and Cardiff all lost nearly a years’ worth of sales, with Central London being the worst affected, losing 47 weeks of sales between the first lockdown and Omicron’s onset.

Businesses in Birmingham (46 weeks), Edinburgh and Cardiff (43 weeks each) city centres are also among the worst hit, 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, the report noted, citing the examples of Oxford and Newcastle city centres where the number of empty storefronts increased by around eight percentage points as sales fell.

Burnley’s city centre lost the fewest weeks of sales (8 weeks) during the pandemic, followed by Warrington and Huddersfield.

Government support shielded high streets less prosperous areas, and places such as Newport, Sunderland and Blackpool store vacancy rates have in fact fallen since 2020.

Meanwhile in economically stronger places, business closures increased by 3.5 percentage points during the pandemic – up from 1.4 percentage points in the two years before, suggesting that government’s Covid-19 support measures were less effective in such places due to higher rents and a lack of custom from office workers.

And while government support has sheltered weaker places, it may have simply stored up pain for the future. The report warns that many less prosperous places in the North and Midlands face a wave of new business closures this year.

“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,” Andrew Carter, chief executive of Centre for Cities, said.

The report recommends campaigns to encourage leisure visitors back when safe to do so and provide part-time season tickets to encourage workers back to the office to avoid permanently levelling down prosperous places. It also calls for dealing with struggling places’ fundamental economic problems to address high street decline.

“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,” Carter said.