Concerns over the pandemic’s lasting impact on the world of work are growing
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The mallowstreet COVID-19 research panel is more concerned about the professional impact of the pandemic than the risks it poses to themselves or their loved ones. Many qualify this further, citing concerns over lower international vaccination rates and increased uncertainty about the pandemic’s long-term professional consequences.
On the personal front, our panel is less concerned because many have already received their first vaccination jabs. Others are less worried about their family and loved ones as they have also been vaccinated and adhere strictly to lockdown guidelines.
Renewed hope for a return to in-person events and international travel by the year end
Pension professionals are confident that we will see a return to normality by the end of the year. In fact, many predict we will even be able to travel abroad by December, a noteworthy change from the sentiment two weeks ago.
Overall, our research panel members expect to do most things listed in our survey far sooner than in previous weeks. These new projections are strongly anchored in Westminster’s proposed timelines for relaxing lockdown rules. One exception is working from the office, which is still predicted to resume at the end of the year.
In addition to not travelling abroad before December and not working in the office before November, the panel also suggests that we should not expect to:
- See family in person until April
- Meet with friends until May
- Go to the pub or travel within the UK until June
- Attend a family gathering or see colleagues in person until July
- Hold in-person meetings until September
- Attend in-person events until November
Pension professionals are not yet comfortable with in-person events
One-third of our panel members are ‘very’ or ‘somewhat’ comfortable with attending in-person events, even though they do not expect this to happen until the latter half of the year. However, the majority disagree - 69% say they would be ‘very’ or ‘somewhat’ uncomfortable attending an event. Vaccine rates are making people feel safer but the prevailing belief is that we are still a long way from reaching herd immunity.
Decreasing levels of worry over Westminster’s pandemic guidance
The proportion of pension professionals that are ‘very’ or ‘extremely’ worried about the government’s handling of the pandemic is in steep decline. As of today, only 4% of our panel feel this way. On top of that, nearly a quarter of pension professionals are now ‘not worried at all’ about the way Westminster is handling the pandemic. The majority of our panel still have some reservations though, with 73% saying they are ‘somewhat’ worried about the pandemic guidance.
Higher inflation rates are unavoidable
Our COVID research panel members are unanimous in their belief that we should expect to see inflation rates rise sometime within the next one to two years. The reasons driving this sentiment are varied. Some suggest that inflation will be tied to food costs, which will rise as a result of the Brexit settlement. Another view is that ‘revenge consumption’ in the retail and travel sectors will trigger pricing increases.
UK schemes are also predicting a near-term tax rise, but opinions are more divided on the subject, with only 69% expecting an increase. This statistic is noteworthy, representing a sizable decrease from the proportion predicting a tax rise two weeks ago. Some within our panel believe that any tax rise need only be modest; enough to help reduce the government debt load. Others predict that tax rises will mostly affect corporation tax rates and fuel duty, while pension tax relief and the lifetime allowance will be spared.
With government spending on the rise and the UK rapidly approaching a phased re-opening of the economy, we will keep an eye on the results of these measures to see if they prompt our panel members to alter their macro outlooks.
What do you think about prospects for the economy going forward? Click here to tell us in our bi-weekly survey.
Previous articles in this series:
About the COVID Concern Index
This short survey helps gauge sentiment of our community on the pandemic. The results are distributed via the community newsletter. Until 31/08/2020, this was a weekly survey. From 01/09/2020, the survey shifted to a bi-weekly cadence.
The COVID Concern Index values should be used as indication only and do not constitute advice. Their values are bound by the choices available in the survey on which they are based.
COVID Concern Index:
- 0 = respondents are not worried at all
- 100 = respondents are extremely worried
Expected minimum duration of outbreak:
A methodology change took place on 06/10/2020, affecting data from 20/10/2020 onwards.
Prior to 06/10/2020:
- Lowest possible value = 1 month
- Highest possible value = 6 months
Following 20/10/2020:
- Lowest possible value = 1 month
- Highest possible value = 12 months
Expected minimum duration of macro effects:
A methodology change took place on 15/04/2020, affecting data from 21/04/2020 onwards.
Prior to 15/04/2020:
- Lowest possible value = 3 months
- Highest possible value = 12 months
Following 15/04/2020:
- Lowest possible value = 3 months
- Highest possible value = 60 months
Macro rates index:
- -100 = all respondents think rates will fall
- 0 = all respondents think rates will stay the same
- +100 = all respondents think rates will rise
Sector sentiment index:
- -100 = all respondents think the sector will be a ‘loser’ in the pandemic
- 0 = all respondents see a neutral outlook for the sector
- +100 = all respondents think the sector will be a ‘winner’ in the pandemic
Concerned about the coronavirus outbreak and its macro implications? Click here to take part in the bi-weekly COVID-19 survey.