Impact of COVID-19 and Brexit on UK's Economy

Contemporary business
environment.

Executive Summary
The purpose of the report is to analyse the impact of COVID 19 in the economy of UK. It is
important for the government to provide necessary support to the businesses as well as households
of the country. An information about the schemes provided by the government for the support of
businesses will be provided. The role of Bank Of England in the current pandemic and economic
downfall is given below. The implications of Brexit will be provided along with its impact on the
economy.

Table of Contents
1. Introduction ......................................................................................................................................4
2. Discussion and Analysis.....................................................................................................................4
2.1. Impact of COVID-19 on the UK’s Economy ..........................................................................4
2.2. Major Economic Responses of the UK’s Government and their Implications ......................6
2.3. Major Responses of the Bank of England and Their Implications to the UK’s Economy.......8
2.4. What are the likely impacts of Brexit on the UK’s economy?...............................................9
3. Conclusion .................................................................................................................................11
4. Recommendations......................................................................................................................11
5. References..................................................................................................................................12

1. Introduction
COVID 19 is severely affecting the countries and their economies. It is important for the
government to take major steps in order to provide support to their economy. It is important for the
organisation to make sure that they are working efficiently so that the operations and workings of
the company does not get affected. Due to the pandemic, the government forced businesses to shut
their trade activities for some time so that their is no further spreading of the virus (Brennan and et.
al., 2018). These restrictions does not only affected the businesses of the organisation but has also
affected the supply chain management of the country. This report covers the impact of COVID 19 on
the economy of UK as well as the impact of Brexit on the economy. The report also covers the
responses of government towards economic impact of the pandemic and the responses of Bank Of
England in order to provide economic stability. Lastly, the report will cover the impact of Brexit on
the economy of UK.
2. Discussion and Analysis
2.1. Impact of COVID-19 on the UK’s Economy
Due to the lock down in the country several businesses have to suffer major losses and at
the end, they were forced to shut down their business. The pandemic has severely affected the
businesses and economy of UK. The country already was trying to cope with the implications of
Brexit and then sudden lock down has created a negative impact on the workings of the economy.
The government has also suffered major losses as their was a significant decrease in the income of
the government due to the less taxes liability (Six in 10 UK firms have no more than three months of
cash left, 2020). As the news of lock down came out, people were very anxious and tried to store as
much basic necessity products as possible which make most of the products go out of stock and as
the supply chain were also disturbed, the situation became worst as the people were not getting
their basic necessity products. The constant flow of products and services is important for the
economy as it will make sure that there is constant flow of money in the economy.
 Unemployment: According to the reports, around 7.6 million jobs in the economy were at
high risk as the government put lock down in the economy. The companies were not having
enough capital or income to provide salary to their workers and people with low income and
low resources are most vulnerable. Nearly 50% of the of all the jobs that are at risk are of
low income which are earning less than £10 per hour (COVID-19 in the United Kingdom:
Assessing jobs at risk and the impact on people and places, 2021). The government has also
initiated schemes which can help the businesses in providing salary to their workers which