These are the slides presented at the Economic Forum Webinar on Monday 17 May 2021

1. ONS Economic Forum
#economicforum
@ONSfocus
17 May 2021 slido #56790

2. ONS Economic Forum
Chief Economist
Office for National Statistics
Chair – Grant Fitzner
#economicforum
@ONSfocus
17 May 2021 slido #56790

3. Agenda
09:30 – 09:35 Welcome and introduction – Grant Fitzner
09:35 – 09:50 State of the UK Economy – Sam Beckett
09:50 – 10:05 Management and Expectations Survey –
Jakob Schneebacher and Anna Ardanaz-Badia
10:05 – 10:25 Q & A
10:25 – 10:30 Close
#economicforum
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4. Questions can be submitted via the slido app using code #56790.
You can also access slido via the link in the chat box.
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5. State of the UK
Economy
Sam Beckett
Second Permanent Secretary, Office for National Statistics
Joint Head of Government Economic Service
17 May 2021 @ONSfocus #economicforum slido #56790

6. Real GDP fell by 1.5% in Quarter 1 2021 and is now 8.7% lower
than its pre-pandemic level
State of the UK Economy
Source: Office for National Statistics – GDP First Quarterly Estimate
Quarterly GDP index
UK, Quarter 1 2019 to Quarter 1 2021, Index 2019 Q4 = 100
Source: Office for National Statistics – GDP Monthly Estimate
60
65
70
75
80
85
90
95
100
105
2019 Q1 2019 Q3 2020 Q1 2020 Q3 2021 Q1
-3
-2
-1
0
1
2
3
Jan-21 Feb-21 Mar-21
GDP Services Production Construction
Contributions to monthly GDP growth
UK, January to March 2021, Percentage points
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7. The trajectory presented by BICS estimates after February 2021
show increasing turnover balances
Source: Office for National Statistics – Business Insights and Conditions Survey
Source: Office for National Statistics – Business Insights and Conditions Survey
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
22-Feb 8-Mar 22-Mar 5-Apr 19-Apr
Has permanently ceased trading
Paused trading and does not intend to restart in the next two weeks
Paused trading but intends to restart in the next two weeks
Started trading within the last two weeks after a pause in trading
Currently trading and has been for more than the last two weeks
Proportion of all businesses with each trading status
UK, 22 February 2021 to 2 May 2021, broken down by industry and size band,
weighted by count, Percentage
Net balances of businesses currently trading against monthly GDP estimates
UK, March 2020 to April 2021
60
70
80
90
100
110
120
March-20 June-20 September-20 December-20 March-21
Unweighted BICS Weighted BICS GDP
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8. Following the easing of restrictions real-time indicators suggest
further increases in consumption
Source: Office for National Statistics and Bank of England calculations Source: Springboard and the Department for Business, Energy & Industrial Strategy
Volume of retail footfall
UK, 1 March 2020 to 8 May 2021, percentage compared with the equivalent day
of the equivalent week of 2019
0
20
40
60
80
100
120
13-Jan-20 13-Mar-20 13-May-20 13-Jul-20 13-Sep-20 13-Nov-20 13-Jan-21 13-Mar-21
1st national
lockdown
2nd national
lockdown
3rd national
lockdown
Non-essential
shops reopen
Non-essential
shops reopen
Tier 4
restrictions/
Christmas
Spending on credit and debit cards - CHAPS
UK, 13 January 2020 to 6 May 2021, Backward looking seven-day rolling average,
non-seasonally adjusted, nominal prices, Index February 2020 = 100
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9. Early indicators of vacancies and furlough suggest that the
demand for labour is increasing
Source: Her Majesty's Revenue and Customs – Coronavirus Job Retention Scheme
statistics and Office for National Statistics – Business Insights and Conditions Survey
Source: Adzuna and Office for National Statistics – Vacancy Survey
0
20
40
60
80
100
120
3-Jan-20 3-Apr-20 3-Jul-20 3-Oct-20 3-Jan-21 3-Apr-21
Adzuna ONS Vacancy Survey
Adzuna weekly job adverts and single month experimental vacancies
UK, January 2020 to May 2021, Index February 2020 = 100
0
5
10
15
20
25
30
35
29-Mar-20 29-May-20 29-Jul-20 29-Sep-20 29-Nov-20 29-Jan-21 29-Mar-21
BICS (unweighted) BICS (weighted)
CJRS Statistics: BICS industries only CJRS Statistics: All industries
Proportion of workforce on furlough leave
UK, March 2020 to May 2021, broken down by BICS wave, Percentage
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10. The pandemic continues to have uneven labour market impacts
Source: HM Revenue and Customs – Pay As You Earn Real Time Information
-400000 -300000 -200000 -100000 0 100000 200000
Accommodation and food services
Wholesale and retail; repair of motor vehicles
Manufacturing
Arts entertainment and recreation
Education
Other service activities
Professional scientific and technical
Finance and insurance
Transportation and storage
Information and communication
Administrative and support services
Construction
Public administration and defence; social security
Health and social work
Absolute change in payrolled employees by industry
UK, March 2021 absolute change on March 2020, seasonally adjusted,
Payrolled employees
Source: HM Revenue and Customs – Pay As You Earn Real Time Information
Absolute change in payrolled employees by age group
UK, March 2021 absolute change on March 2020, seasonally adjusted,
Payrolled employees
-350000 -300000 -250000 -200000 -150000 -100000 -50000 0
65+
50-64
35-49
25-34
18-24
0-17
State of the UK Economy slido #56790

11. Trade in goods imports and exports increased in March
Source: Office for National Statistics – UK trade statistics
0
5
10
15
20
25
30
35
Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 Mar-21
EU exports Total exports
0
5
10
15
20
25
30
35
40
45
50
Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 Mar-21
EU imports Total imports
Source: Office for National Statistics – UK trade statistics
Total and EU goods exports, including precious metals
March 2019 to March 2021, current prices, seasonally adjusted, £ billion
Total and EU goods imports, including precious metals
March 2019 to March 2021, current prices, seasonally adjusted, £ billion
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12. The economic outlook
The Government’s Roadmap to ease lockdown
restrictions:
• March 8th/ 29th: Schools re-open and some
outdoor sports and social activities are allowed
• April 12th: Non-essential retail, outdoor hospitality,
outdoor attractions, personal care as well as self-
contained accommodation and indoor leisure
facilities without household mixing are allowed
• TODAY May 17th: Indoor hospitality, indoor
attractions, remaining accommodation and outdoor
entertainment, indoor events for up to 1,000
people and outdoor events for up to 10,000 people
are allowed
• June 21st: All limits on social contact are removed
and nightclubs and large events are allowed
Source: Bank of England – Monetary Policy Report May 2021
Monetary Policy Committee forecast
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13. In collaboration with the Economic Statistics Centre of Excellence (ESCoE), with funding from
ESRC grant ES/S012729/1
Management and
Expectations Survey:
2020 Initial Results
Economic Microdata Research
Analysis, Microdata and Engagement (AME)
Anna Ardanaz-Badia, Zuzka Hilton, Zahir Islam, Kyle Jones,
Jakob Schneebacher, Mohammad Shafat
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14. How does management differ?
• Three big questions:
• How do management practices vary across region, industry and firm types?
• How do management practices change over time, and during the pandemic?
• What role do management practices play in helping firms adapt in the pandemic?
• This matters:
• Because intangibles, including managerial capital, are crucial for understanding productivity
• Because management practices vary widely across the world
• For policy: productivity puzzle, levelling up, business resilience
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15. Systematic variation across firms
What we find:
• Significant variation across industries, regions and size-bands
• Among smaller businesses, long tail of less well-managed firms
• Changes since 2016 mostly driven by improvements among small firms
• Targets and continuous improvement wide-spread, KPIs less so
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16. Changes from MES 2017
0.0
0.5
1.0
1.5
2.0
2.5
3.0
0.0 0.2 0.4 0.6 0.8 1.0
Management score
2016 2019 2020 2016 mean 2019 mean 2020 mean
Density
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17. Management in the pandemic
What we find:
• Positive relationship between management and homeworking rates in 2020
• Even after controlling for other factors, well-managed firms more likely to
increase homeworking and online sales during pandemic (but not before)
• The overall causes of management practices, and the effect on labour
productivity, are stable over time
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18. Roadmap
1. Methods & Data
2. Management Practices in Great Britain
3. Management Practices and Homeworking
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19. Methods & Data
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20. Four dimensions of management
Management score building on ONS (2018) and earlier work by Bloom,
Sadun and Van Reenen (2013)
1. Key performance indicators (KPIs)
2. Targets
3. Employment and hiring decisions
4. Continuous improvement
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21. A quick peek at the questionnaire
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22. Sample descriptive statistics
MES 2020 usable responses 12,124 (response rate: 24%)
MES 2017 usable responses 8,437 (response rate: 39%)
Response rate across size bands (250+: 16%, 50-99: 30%)
Response rate across regions (London: 20%, South West: 27%)
Response rate across industries (Human Health Activities: 15%,
Wholesale and Retail Trade: 32%)
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23. Management Practices
in Great Britain
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24. Management Practices in Great Britain
Mean management practices by
category
0.0 0.2 0.4 0.6 0.8 1.0
Key performance indicators
Employment practices
Targets
Continuous improvement
Overall management practices
Management score
2020 mean 2019 mean 2020 median 2019 median
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25. Changes from MES 2017
0.0
0.5
1.0
1.5
2.0
2.5
3.0
0.0 0.2 0.4 0.6 0.8 1.0
Management score
2016 2019 2020 2016 mean 2019 mean 2020 mean
Density
Management Practices in Great Britain slido #56790

26. Distribution of management scores by
employment size bands over time
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27. 5% 10% 25% 50% 75% 90% 95%
Mean
Key:
Percentile distributions by industry groups -
2020
0.0 0.2 0.4 0.6 0.8 1.0
Non-Manufacturing Production
Manufacturing
Construction
Distribution, hotels & restaurants
Transport, storage,
& communication
Business services
Other services
Real estate
Population
Management score
Industry group
Management Practices in Great Britain slido #56790

28. Regional distribution of MES score
Management Practices in Great Britain slido #56790

29. Management Practices
and Homeworking
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30. Larger switch to homeworking in 2020 among
better-managed firms
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
1 2 3 4 5 6 7 8 9 10
Management score deciles
Non-Managers Managers
Average % Change in Homeworking
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31. Better-managed firms adapt better in the
pandemic than comparable peers
-10 -5 0 5 10 15 20
% Non-managers working remotely
% Managers working remotely
% Online sales
2019 2020
Management score coefficient
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32. Summing Up
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33. Conclusion
• New evidence on the distribution of management across British firms in 2019/20
• Significant regional, industry, size variation
• Improvement since 2016 driven by catch-up of less well-managed micro-firms
• Better-managed firms are better able to adopt new business practices in 2020
• Controlling for other factors, positive and significant effect of management practices on
homeworking and online sales during the pandemic (but not before)
• Overall, the causes and effects of management practices are quite stable from 2016 to
2020
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34. Next steps
Ongoing analysis:
• Through what channels of investment is managerial capital accumulated?
• How is good management related to R&D or the R&D effectiveness?
Data access:
• Work under way to deposit MES 2020 microdata into the Secure Research
Service (SRS)
Summing Up slido #56790

35. Questions can be submitted via the slido app using code #56790.
You can also access slido via the link in the chat box.
Q & A
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36. Closing remarks
Chief Economist
Office for National Statistics
Grant Fitzner
17 May 2021 #economicforum
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37. Forthcoming ONS economic analysis
19 May – Drivers of recent trends in consumer prices
24 May – Mapping income deprivation at a local authority level: 2019
25 May – Impacts of the coronavirus and EU exit on UK trade
25 May – Understanding the business impacts of local and
national restrictions
1 June – Analysis of GDP revisions in Blue Books, 2020
7 June – Real-time indicators: A year on
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38. Upcoming ONS events
20 May 2021 – Productivity user event
25 May 2021 – ESWG Seminar: Round table on GDP and Welfare
14 June 2021 – Economic Forum; presentations to include:
• State of the UK economy
• Future of work: The impact of COVID-19 on changing business and individual
attitudes to remote working
Further details on the above events can be found at:
ons.gov.uk/economicevents
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