Lockdown changed how we live, work and shop significantly, but not all these changes have endured, nor have they been evenly spread across the country.
The 23rd March 2023 marked the third anniversary of the UK’s first lockdown, and rapid changes in how we live, work and shop in cities. Last week, Centre for Cities hosted speakers from the Local Data Company, Rightmove and Lightcast to explore what the data tells us about these changes over the last three years, and how cities have responded. Here are the headlines from their discussion.
Remote working did increase due to lockdown, but from a low base. Lightcast data shows that the share of job postings specifying that remote or hybrid working is allowed increased from just 1.5 per cent pre-pandemic to just below 10 per cent during lockdown. The share of job postings mentioning remote, hybrid or no remote working in any context, increased rapidly from 2 per cent pre-pandemic to 12 per cent.
The extent of this trend varied by employment type as just 4 per cent of jobs in low- and medium-skilled occupations offer remote working, compared to 12 per cent for high-skilled jobs. Cities with a high share of skilled and professional occupations therefore experienced a greater shift towards remote and hybrid working.
These changes prompted demand for more spacious housing. Demand for properties – the numbers of people sending enquiries to agents via Rightmove – began to increase even before restrictions eased in Summer 2020. Data on keyword searches such as ‘acre’ and ‘annexe’ for house sales shows that people were searching for more spacious properties throughout late 2021 and Spring 2022. For rentals, features such as gardens and ‘pet-friendly’ became more in-demand.
Location preferences also changed. The share of people looking to leave cities increased year on year from 2020 – 2022. For both sales and rentals, people broadened their search areas from about 60km2 to 110km2, and there was an uptick in the proportion of people sending enquiries about properties more than 50km away from their current location – from 14 per cent in January 2020 to a peak of 18per cent in July/August 2021 for sales, and from 10 per cent to 15 per cent for rentals.
Restrictions had a significant impact on retail and accelerated the existing shift towards online shopping, particularly for ‘non-essential’ retail. Vacancy rates increased everywhere according to the Local Data Company’s data, reaching a record high of 14.5 per cent in the first half of 2021. Chain retailers bore the brunt of this, experiencing a net decline of 10,000 units since 2020. There has been better news for independents though, which saw an increase of 2,000 units in 2021.
As restrictions eased, these trends have stabilised and then have returned towards pre-covid baselines, rather than a ‘new normal’ that was predicted by many in the early stages of covid. After lockdown, the benefits that cities offer as places for production and consumption – what we call ‘agglomeration benefits’ – largely remain.
Remote working trends had plateaued by the end of 2022. Job postings allowing remote and/or hybrid working have remained relatively stable at just under 10 per cent, and the number of postings referencing these ways of working in any context also stabilised at around 10 per cent.
The proportion of people looking to make longer-distance moves has returned to the pre-covid baseline of around 14-15 per cent for sales. In the rental market, however, the rising cost of living has prompted a shift towards demand for affordability and energy-efficiency, and the share of people looking to move longer distances remains higher than pre-pandemic.
Similarly, shop vacancy rates have stabilised, and footfall has largely returned to pre-covid levels. In some locations, notably in the North West, vacancy rates have now fallen below pre-pandemic levels (although cities here went into the pandemic with high vacancy rates). There is also evidence of a cautious return by shoppers – retail parks recovered faster than high streets, likely due to the ease of adapting to social distancing and omnichannel retail, with vacancy rates dropping from a high of 11.5 per cent to 9 per cent by the end of 2022.
And Centre for Cities’ latest research shows that, while online spend jumped during the pandemic, it has fallen since and is no higher now than the longer-term growth in online spending would have predicted in the absence of covid.
The last three years have seen a huge amount of turbulence. There have been some definite changes. Hybrid working is much more commonplace now than it was in 2019, in particular. But we don’t all now work remotely and shop online or live in the countryside, and it seems likely there will be further changes to come.
While comparing to a pre-covid baseline tells an important message about how much life has changed, we also should not obsess about this, especially in weaker places. They went into the pandemic from a disadvantaged position, and restoring themselves back to a position of weakness clearly isn’t a good place to end up. Addressing the much longer-term challenges these places face is what local and national policy needs to focus on.
Centre for Cities will continue to monitor both the effects of hybrid working and the strengthening of weaker places in the coming months and years.
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