Economics bulletin 21 January

Date : 20 January 2022

Your overview of political and economic news with a focus on the food and consumer goods industry, featuring the latest developments and guidance on COVID-19, the rising cost of living, labour shortages and adapting to a new relationship with the EU.

Rising inflation

Latest inflation data from the ONS has revealed that inflation has reached its highest level for 30 years, reaching 5.4% on the Consumer Price Index (CPI). Food and drink inflation has risen sharply from 2.5% in November to 4.2% in December.

Will inflation kill the recovery? Find out more by downloading our latest Viewpoint report.

Declining unemployment and real wages

Unemployment declined by 0.4% over the quarter according to the ONS, however, job vacancies continue to increase, reaching a record 1.25m in December 2021.

Wage growth is struggling to keep pace with inflation. Adjusting the wage data to account for Retail Price Index (RPI) inflation, the ‘real’ wage growth of workers has fallen over the last two months on record.

Relaxation of COVID-19 restrictions

The Prime Minister has confirmed that the majority of Plan B COVID-19 rules will be removed in England by Thursday 27 January. This includes:

  • Mandatory NHS COVID-19 passes in nightclubs, and other settings with large crowds, will end
  • Mandatory use of face masks in public indoor venues, including retail settings, is no longer required
  • As of 20 January, individuals are no longer advised to work from home

There is still a legal requirement to self-isolate for those who test positive for COVID-19.

The latest information on restrictions in England can be found here.

The First Minister for Scotland has announced that COVID-19 restrictions applying to Scotland are to be eased from 24 January. These include:

  • No requirement for one metre physical distancing and table service in hospitality and retail
  • No requirement to limit social interaction in indoor spaces to three households

Several other restrictions will remain in place:

  • Individuals will be asked to work from home
  • The wearing of face masks in public places and on public transport
  • The current COVID-19 certification scheme will remain in place. This scheme requires COVID-19 status certificates to be provided to enter high-risk settings such as nightclubs and crowded spaces
  • Self-isolation rules for those who test positive for COVID-19

The latest information on restrictions in Scotland can be found here.

The First Minister for Wales announced that from 21 January no restrictions will remain in place for outdoor activities and from 28 January restrictions in indoor settings will be eased, including:

  • The removal of the legal requirement to work from home
  • The removal of the rule of six and two-metre physical distancing in hospitality

Several other restrictions will continue to remain in place:

  • Self-isolation rules for those who test positive for COVID-19
  • Face coverings in most public indoor places including shops

The latest information on restrictions in Wales can be found here.

See here for details on further relaxation of restrictions in Northern Ireland.

Absence update

Although there are some regional variations, absence rates within the food and consumer goods industry due to the Omicron variant remain largely manageable and are starting to decline.

Businesses can also reduce the risk by encouraging staff to get vaccinated and to receive the booster. See the section on ‘reducing contact for workers’ here for further details.

The Department for Environment Food & Rural Affairs (DEFRA) is requesting that businesses complete a daily labour absence survey.

Critical worker testing

Lateral flow tests have been provided to businesses with workers that are deemed critical to the food supply chain, including large retail distribution depots, wholesalers and meat processors. This follows an announcement by the Prime Minister that 100,000 critical workers will be eligible to receive lateral flow tests to enable regular testing from 10 January.

Businesses and individuals are also encouraged to source free lateral flow tests from the government website. Supply of these tests continues to improve.

Changes to EU-GB Imports and exports

To date there have relatively few issues following the introduction of new Animal Health Regulation (AHR) Export Health Certificates (EHCs). This applies to products of animal origin exported to the EU or moved to Northern Ireland (NI), effective from 15 January 2022.

Please note, EHCs used by Authorised Traders to move prohibited and restricted (P&R) goods to NI are unaffected by these changes.

DEFRA is working with industry and the EU Commission to resolve outstanding issues impacting the use of EHCs for dairy products.

New Export Health Certificates (EHCs) can be found here.

See the key dates for UK-EU transition and support for businesses

See the guidance on trade with the UK as a business based in the EU.

Avian Flu update

DEFRA is working with industry to address the impact of avian flu across the UK, following the biggest ever outbreak of the disease. This includes addressing issues concerning internal biosecurity measures.

The government is continuing to monitor the impact of the housing measures on the labelling of free-range eggs. Eggs can continue to be marketed and labelled as “free-range” for 16 weeks after the birds have been brought indoors, but if the restrictions last beyond that they must be downgraded to “barn produced”.

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