UK aviation sector worth £15 billion before pandemic

Saturday, 12 Oct, 2020 0

The UK domestic aviation sector contributed £15 billion to the UK economy before the pandemic, according to data from a study commissioned by London City Airport.

The report by WPI Strategy also highlighted the importance of domestic and international travel to the economic prospects of individual businesses and the wider economy.

The report reveals the majority of UK business leaders see air travel as key to their future economic prospects and would return to the skies if quarantine measures were eased.

London City Airport Chief Executive Officer Robert Sinclair said the new Global Travel Taskforce would give business air travel ‘a much needed shot in the arm’ and urged the new group to move quickly to get business air travel up and running again.

"The UK aviation industry is the third largest in the world and a global success story. But it is not just an industry itself, it also acts as an enabler of other industries such as trade, tourism, hospitality, imports, exports and conferences. We know the demand for air travel is there, but restrictive quarantine measures are currently holding business leaders back from flying, and the UK economy from beginning its recovery.

"We sincerely hope that the Global Travel Taskforce both acknowledges how fundamental business travel is and moves quickly to introduce a roadmap for aviation which sets out how a testing regime can be implemented quickly. Doing so could deliver a much-needed shot in the arm for business air travel, boosting economic growth across every region and every sector," he said.

According to a poll of 515 business leaders by market research company Survation contained within the report, nearly half (48%) thought the Government’s travel and quarantine restrictions were the single biggest barrier to business air travel and 76% believed that airport testing would increase confidence when travelling. A total of 64% of UK business leaders saw air travel as key to their future prospects while 88% of leaders of businesses with more than 250 employees believed air travel was important to the future success of their business.

New data within the report also underlines the importance of domestic aviation to the UK economy. Before the outbreak of the pandemic, the total value of domestic aviation in the UK was in the order of £15 billion.

Proportionate to passenger numbers, the authors break down the impact of domestic aviation on GDP by UK regions and nations as in the order of:

Scotland: £4 billion
North-East: £300 million
North-West; £1 billon
Northern Ireland: £2 billion
South-West: £700 million
London: £4 billion
Midlands: £500 million
Wales (just Cardiff): £80 million

Sinclair was backed by business leaders and politicians from across the UK who are concerned that the government’s plans for levelling up the country and increasing the UK’s trade links could be at risk without a speedy introduction of testing.

Stephen Hammond, MP for Wimbledon and Chair, All Party Parliamentary Group on Business Travel, said: "The economic recovery will be led by the business community and the ability to travel will be key. Business travel adds huge economic value directly and indirectly on industries like events and conferences amongst many others. I hope the Government will prioritise the need to allow safe travel including pre travel testing and a new quarantine regime so business can get back to travelling and building a strong economic recovery."

The £15 billion figure has been produced by WPI Economics, based on Oxford Economics estimating the total contribution to GDP of the aviation sector in the UK as £72 billion in 2014 and domestic aviation in 2014 accounting for 17% of total passenger movements.

by Louise Longman, Contributing Editor (UK)