The two Easter bank holidays just gone cost the UK economy £4.7 billion, with the figure rising to a huge £19 billion if all eight annual breaks are taken into consideration.
According to the Centre for Economics and Business Research, if the country’s regular bank holidays were axed, annual GDP would rise by 1.3% as each one leads to £2.3 billion in lost revenues. The sectors that lose out most in financial terms are office-based operations, factories and construction sites, which account for 47% of the economy. The biggest gainers are retail, wholesale, hotel and restaurant-based sectors, which comprise only 14% of the total wealth generated. But Cebr economist Daniel Solomon pointed out that special one-off bank holidays such as the forthcoming Queen’s Diamond Jubilee weigh less heavily on the economy than normal ones because the tourism sector benefits from additional foreign visitors, while consumption is also often boosted. Nonetheless, he cited the Department of Culture, Media and Sport, which estimated that last year’s Royal Wedding still cost the UK £1.2 billion or 0.08% of GDP. As a result, Solomon raised the question of whether the UK should cut the number of bank holidays that are provided to workers, not least because the number of hours worked by the average Brit is lower than some international averages. UK employees who work full time do so for about 1,647 hours per year, he said, while US staff work for 1,695 hours and Korean personnel for 2,191 hours. But in the end, Solomon believes that making such a change is “more a social than an economic judgement”. “Because people took annual leave to bridge over some of the holidays, business lost momentum [last year] and this probably contributed to the rather weak economic performance over the year,” he said. “But in a normal year, eight holidays is probably not too many – though they could be spaced out a bit better over the year.”