Leveling? The pandemic widens economic gap between London and Wales, ONS data shows

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From the poorest to the richest – A community in the Welsh valleys (left). Image by Biggs (CC BY 2.0). City of London (right).

The pandemic has widened the economic divide between London and Wales, according to the Office for National Statistics.

London experienced a smaller economic contraction than Wales in Q1 in 2021 and a major rebound in Q2, statistics released on Friday show.

Model-based estimates of regional GVA growth show that the Wales economy shrank by 1.4% in Q1 before rising 4.3% in Q2.

London, meanwhile, fell 1.3% in the first quarter and rose 4.6% in the second.

Statistics showed that London’s economy has been more isolated from the hit of the pandemic than any other region in England and Wales, according to analysis in Financial Times.

“This means that London could have widened the large output gap with the rest of the country, making Prime Minister Boris Johnson’s leveling of the agenda to tackle regional disparities in the UK even more challenging,” they said.

The data suggested that the large presence of financial and business services, where most people could continue to work from home, in the metropolitan area has helped isolate it from the economic hit of Covid-19 restrictions, they added.

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