Evaluating the Contemporary Business Environment

Evaluating the
contemporary business
environment

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY ..................................................................................................................................3
UK's economy economic impact on COVID-19 ………………………………………….. ……3
Major economic response of the UK's government and their economic implications....................4
Major responses of the Bank of England and their implications to the UK's economy..................7
Impacts of Brexit on the UK's economy..........................................................................................8
RECOMMENDATIONS...............................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business environment is defined as the internal and external forces that affect how
company functions. It includes employees, customers, management and business regulations. It
covers factors and forces such as customers, suppliers, government, competitors, technological
and legal conditions. According to contemporary business environment it considers applied
aspects of environmental processes and fundamental and human impacts on the
environment(Arda and et.al., 2016). For all kinds of businesses, COVID situation has made the
environment very complicated and restricted as well. This report covers analysis about economic
impact of COVID-19 on the UK's economy and about economic response of UK government.
This report covers analysis about major responses of Bank of England and their implications on
UK's economy. The research has been done on impacts of Brexit on the UK's economy.
MAIN BODY
UK's economy economic impact on COVID-19
Pandemic situation act as in the negative form with respect to performance of UK's
economy due to which it has major impact on business world. In the year of 2020 UK'S GDP has
declined by 9.8% and economy has to face steepest fall in terms of its performance. UK GDP
was 25% lower in April 2020 as it was two months earlier in February during its first lock
down(Aro-Gordon, S. and Chandrashekhar., 2016).According to economists, the economy has
adapted well to the lock downs with a smaller decline in economic activity which was recorded
in early 2021 and GDP has fell by 2.5% in January (Economic impact to date, 2021). According
to economic outlook of year 2021 it has been observed that when economy has reopened into
slower pace then economic indicators suggest that economy is under phase of strong recovery.
The GDP growth is of 6.5% which is 4.8% up from two months ago according to economists
(Bissonnette and De Koninck., 2017). Due to this pandemic situation, public finaces of
UKcountry have also been strongly affected. In year of 2020/21 government's budget has
reached to its peacetime record where tax revenues fell and government spending has increased
on a large scale.

UK's economy has to face various kinds of challenges at the time of pandemic situation.
According to OECD, among major economies UK is one of the country which is majorly hit by
this pandemic situation. In year of 2020, economy of Britain is fall down by 11.5% slightly
outstripping falls in countries such as Italy, Spain, France and Germany. By the government's
lock down restrictions, UK's service based industry has been majorly hit(Bratton, ed., 2020).
Service sector which includes financial services, hospitality and tourism has been hit in a very
bad manner and it takes about three quarters of UK’s GDP to make up its situation. According to
Shadow Chancellor Anneliese Dodds, pandemic situation has been majorly hit UK economy and
this has been proved by current evidence from OECD.
When government has faced failures in terms of health management and in that case the situation
has become worst (Wang, 2016). In this pandemic situation, position of UK country has been
observed in terms of unstable manner and government has also does not show any proper
concern about it. This is the main economic impact on UK’s economy due to this pandemic
situation.
Major economic response of the UK's government and their economic implications
UK government has taken various kinds of steps in terms of improvement in UK's
economy and for further growth of nation it has been implemented into positive manner.
Nation’s health is the first consideration and for that purpose government has taken various kinds
of initiatives towards it. Government ensures about this initiative that people who are suffering
from coronavirus has to receive the best medical aid and this has been considered as their first
priority(Ercegovac and et.al., 2020). Government has taken various steps with respect to
supporting business of country where an initial £330 billion of government and guaranteed loans
as well. It makes a material contribution to wage bills and salary(Our plan to rebuild: The
government's COVID-19 recovery strategy).
To help UK businesses, Bank of England and HM treasury provide schemes related to financing
on larger scale for purpose of making continuous flow of cash into the economy. Government
has introduced some schemes such as scheme related to job retention, scheme of apprentice,
traineeship scheme which act as strong point in terms of employment.