London recovery stalls as workers shun return to office

London’s economic recovery is being held back with half of the capital's workers resisting a return to office life.

Footfall in London was only half of its pre-pandemic levels by the end of September, the Centre for Cities has revealed.

The think tank’s weekday footfall gauge - an indicator of workers back in the office - climbed from 60pc in late August to 67pc for a range of 63 cities and towns in which it was studied, despite hopes for larger numbers of workers to return to the office in September.

London had the lowest footfall compared to pre-Covid norms with airport hubs Luton and Slough also in the bottom five. The plunge in footfall in Luton and Slough suggest that their high claimant count and furlough rates are having a knock-on impact to the local economy as their nearby airports struggle.

Paul Swinney, head of policy and research at Centre for Cities, said: “The return of office workers has been a gradual but continued increase rather than a Big Bang.

“Indications from data for early October suggest that this increase will continue, but time will tell as to whether we will get back to anywhere near pre-Covid levels.”

Ministers are concerned that homeworking could damage city centres and businesses that rely on office workers. The footfall figures will intensify concerns for many furloughed workers, particularly in hospitality, after the Chancellor’s wage subsidy scheme ended on September 30.

Mr Swinney said: “It now poses a question about what that means for all those jobs in the centre of London and whether we will see a spike in unemployment this month as a result of that support coming to an end.”

He added the return to the office had been “very slow”. Blackpool, Swansea and Burnley have enjoyed the strongest recovery in footfall.