The cost to the region's economy of the coronavirus pandemic has been revealed in a report on the impact of the lockdown.

The UK Powerhouse report, compiled by law firm Irwin Mitchell and the Centre for Economic and Business Research, the South East's gross value added (GVA) is falling in the region of 35% - that equates to some £393million - a day.

GVA is the measure of the value of goods and services produced in an area.

However, it says despite the startling figures, the South East is actually faring better that many regions - with only London retaining more of its GVA per day.

By comparison, London is losing £575m a day - 27.7%.

According to the report, the resilience of the economy can be traced to the professional services sector and the ability of many to work remotely.

One of the major sectors of the South East economy, it says, is the wholesale and retail trade.

Before the lockdown, it produced £135m of GVA per day. This is the sector that saw a significant surge in food retail at the outset of the lockdown due to panic buying, however, the sector has since stabilised.

Overall, the sector is facing a loss of GVA per day of £85m, equivalent to 63%. Many non-essential retail outlets have stopped trading under lockdown, with only online retail and essential retail continuing. Online retail only accounts for about 19% of total sales and hence cannot fully recover lost in-store non-food retail.

This fall in consumer demand has inevitably had an impact on the manufacturing sector.

GVA per day in the sector has fallen by 81% relative to pre-lockdown levels. This is equivalent to £75m less GVA per day and is the second largest loss for the region behind wholesale and retail.

But despite claiming the UK economy is losing £2.7bn a day in absolute terms, the report says some sectors such as agricultural, forestry and fishing, along with the information and communication sector, have remained strong with a relatively low daily GVA fall of 14% and 2% respectively.

It adds that a national 1.3% rise in the share of the workforce mainly working from home over the past five years puts the UK economy in a more resilient position in terms of share of people able to work remotely.

The report said the South East leads the way when it comes to working from home with a 1.8% increase since, taking the total proportion to 7.1% of employees.

For these people, it is likely that their ability to work from home will continue on a fairly usual basis. Furthermore, they would have been well set up at the start of the lockdown, as they already had the space and equipment to work from home.

Victoria Brackett, CEO of Irwin Mitchell’s business services division, said: “Although in absolute terms the South East economy is losing almost £400m a day, in relative terms it has fared better than many regions in the UK.

“One of the reasons for this is that the region has the highest share of the workforce that worked from home before the virus started spreading. For these people, it is likely that their ability to work from home will continue on a fairly usual basis. Furthermore, they would have been well set up at the start of the lockdown, as they already had the space and equipment to work from home.”

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