Economic growth demands robust decision making in our “new normal” environment

In 2020 the world experienced one of the biggest challenges for humankind in living memory – outside of war at least. In March of that year, business in the developed world begun to grind to a halt with the onset of a global health pandemic. Since then, the economy and society has refocussed, re-established, and stabilised economic performance. However, the market shock generated by COVID-19 lingers and remains a reality for all walks of life but especially vulnerable groups and those on the front line of care, and in parts of the world where vaccination is not an affordable option.

Writing in early 2022, what is clear now, is that the pandemic’s “new normal” will not be short-term and will reverberate across the UK and the wider world with a longer-term structural adjustment around recovery, society, the economy and climate emergency. For the UK, the added structural adjustment of post-EU trade is also yet to play out.

Insofar as one can regulate and shape markets, for the places and industries worst affected, we firmly believe that locally specific action in the UK (and elsewhere) is needed to support the transition and realign the focus post-pandemic. This means expanding sectors in health and care, logistics and ICT, and the green economy, and to support a decisive switch to new and greener ways of working and commuting. It means considering a new localism and ways of spatial planning and relationships between towns, cities, home and work.

There is a consensus that output will revive as ‘lockdown’ ends, but not about the extent of the revival. The UK Treasury’s most recent economic growth data shows the resilience of the UK economy through 2020 and 2021. However, both unemployment and inflation are on the rise and the start of “semi-austerity” from the new 2022-23 financial year (NI and Corporation tax rises and reduced Government spending) will exacerbate the former without addressing the latter in our opinion.

Consequently, markets will be tight and robust decision making is critical. Below are 6 key attributes to keep front of mind:

1. Context - strategy, action, and investment requires a thorough understanding of market data to reduce risk and maximise chances of success. Harness data analytics and economic expertise to support robust decision making.
2. Act at the appropriate spatial level. What works for a large urban area might not be suitable in a rural setting or in a particular neighbourhood with a dominant community of interest.
3. All the above should reflect in a proportionate investment in preparation – normally a business case. Don’t cut corners here.
4. Consult – get the stakeholders involved. Digital helps but face-to-face and group dynamics remain relevant. Understand the counter perspective, listen and design with the ultimate user in mind.
5. Learn from the past but learn as you go – include feedback loops so that evaluation and policy are linked in a virtuous circle of dynamic data collection, review and revised implementation.
6. Avoid silos. Consider demand and supply, consider sector integration, and work to a shared goal not a one-dimensional investment. Placemaking and people focused investments are the best examples of this. Innovation and improved performance will often result from nexus thinking.

For more information on how Steer can support your business, get in touch with one of our experts today.