Business leaders have warned that continued strikes will cause ‘incredible’ damage to the UK in the short and long term as businesses brace for severe disruption.
Economists at the Center for Economics and Business Research (CEBR) have warned that the three strikes on Tuesday, Thursday and Saturday will have a spillover effect of at least £91million on the UK economy.
Industry leaders have warned that costs could be even higher as travelers and commuters decide to stay home.
Richard Burge, chief executive of the London Chamber of Commerce and Industry, warned that the capital ‘cannot afford a summer of chaos on the railways and Tube lines’.
The entrepreneur has called on the RMT union, Network Rail and the government to resume negotiations, fearing this week’s action could be repeated later this year.
“While this strike is damaging, a recession seems likely regardless; as such, I would not attribute any possible recession to this strike,” he said.
“However, what is very worrying is the possibility that this dispute will continue throughout the year and that we will see multiple strikes in the future.
“A lost week every month for the foreseeable future is going to cause incredible short and long term damage to the UK’s economy and reputation as an attractive destination for investment.”
CEBR has predicted that almost 50% of the impact of the strikes will be felt on Tuesday, when metro and railway workers will be involved in strike action.
Hospitality and retail businesses are expected to be particularly vulnerable to the financial consequences of lost business.
Kate Nicholls, chief executive of UKHospitality, has warned the railway strike could cost the sector up to £540million.
She said: “Fragile consumer confidence will be further impacted, thousands of people able and willing to spend money in hospitality venues across the country will be prevented from doing so, while staff will have no no doubt struggling to get to work.
“We should all be pulling in the same direction if we are to get the UK economy back on track and to see urgent and productive talks to avoid widespread disruption next week.”
Meanwhile, James Hardiman, senior analyst at the British Retail Consortium (BRC), said: “Unsurprisingly, the upcoming rail strikes will be damaging to retail as the strikes limit commuter and customer traffic.
“Traffic in the UK is already down from pre-pandemic levels, and this will only slow the progress made by retailers in bringing people back to the store.”