Back in June 2020, Centre for Cities launched its High Street Recovery Tracker, using monthly footfall and spend data to monitor the impact of Covid-19 in the UK’s largest 63 city centres. Since then, high streets have been a core component of Centre for Cities’ research, including in its annual flagship report Cities Outlook 2022. Two years on from the start of the first lockdown, we have learned three things that you should know about high streets, the pandemic, and what the future might hold for them.
1. Large and successful city centres have borne the brunt of the pandemic
Covid-19 turned the performance of the high street on its head. The UK’s largest, most successful city centres including London, Manchester, Cardiff and Bristol were hit the hardest during lockdowns, and were slower to recover when the economy reopened (Figure 1). The impact on retail and hospitality businesses was sharp. Those in central London, for instance, lost nearly a year’s worth of sales between March 2020 and the eve of Omicron, and accounted for a third of all high street closures in UK cities.
Figure 1: Overall recovery per city size, 2020-2022
Size was not the only factor: smaller but thriving city centres like Cambridge, Oxford, and Reading were also severely hit.
What they had in common were two main pre-pandemic strengths that, almost overnight, became weaknesses: first, a high share of workers with office jobs, and second, a wide and affluent catchment area. Before Covid-19, both of these fuelled demand for shops, cafes and restaurants on the high street. With remote-working guidance and travel restrictions, that core segment of the market for retail and hospitality businesses vanished.
Two years on from the start of the first lockdown, recovery is well underway but these scars are still visible. Office workers aren’t back everywhere: in London, Reading and Manchester, footfall during the working week is still respectively 40, 23 and 18 per cent down its pre-pandemic levels. And whether long-distance commuters or tourists, evidence suggests that it’s the people coming from that wide catchment area that are still the most reluctant to come back. As Figure 1 shows, the capital is by far the most affected still by the combination of these two factors.
2. Covid-19 has far from killed high streets and city centres
When the pandemic hit, it wasn’t uncommon to read that city centres would be permanently hurt by changing shopping preferences, whether shifts online or on to local high streets. Two years on, those concerns have faded away. City centres have reclaimed their role as prime destinations for shopping or socialising, and neither internet shopping nor local stores have proven to be significant threats to them. This is seen on weekends for instance, where in most places central high streets were even busier last month than they were in February 2020. It’s the same too for the night-time economy: even the West End in London is not too far behind, and is likely to get another boost when international tourists return.
Figure 2: Footfall recovery in city centres on weekends and evenings, February 2022
The reason why city centres bounced back from a leisure and consumption perspective on weekends and evenings has to do with the very unique nature of high street amenities in city centres: by definition their central location, density and scale enable restaurants, theatres, cinemas and pubs to cluster in them. This creates a diversity of offer that customers can’t find elsewhere.
Of course, while Covid-19 did not sound the death knell for the high street, weekend shoppers and evening revellers are only one part of the equation. As well as consumption, cities are places of production-and the latter fuels the former. Persistently high remote-working rates would still, in some places, put a number of jobs in local services at risk.
3. High street recovery means different things in different places
Two years on from Covid-19, it’s also time we progressively shift the narrative away from that ‘relative’ framing when talking about the health of the high street. What really matters now is not so much how city centres are doing compared to their early 2020 selves. Especially for those places that have ‘recovered’, the real question is: what does recovery even mean?
For the city centres of Blackpool, Burnley, Sunderland and many others, bouncing back is not the end of the road. It means returning to a position of relative weakness, where low levels of footfall and consumer spending power were unable to sustain high street amenities. This is what national and local governments should focus on now. The changes and policy interventions that should arise from this are not really new. Many of these places should shift away from being places of consumption towards production, and from over-reliance on retail space. They should focus on making city centres a better place to do business and attracting investments for high-skilled, high-paid jobs; and demand for high street retailers will follow.
It’s a different story in places like London or Cambridge. They might be relatively further away from their own pre-Covid position, but in absolute terms are still doing better than most places in the North or the Midlands. By November 2021, vacancy rates in London were still half those in Stoke. The ‘new normal’ might require adjustments in the short-term (if, for example, workers don’t return). But the fundamentals of London’s success are still there and they should enable its economy to adapt and thrive in the long run.
Read the next blog in this series here.