The British economy sunk into its deepest recession on record in the second quarter, taking it back to the size it was in 2003. Official statistics showed gross domestic product dropped by 20.4 percent between April and June, compared with the previous quarter.
The pandemic-induced collapse was harsher in Britain than other large economies in Europe and North America. The second-quarter fall in economic output was twice as deep in Britain as in the United States.
Britain has the challenge of getting out of a much deeper hole because of the length of the lockdown imposed to restrict the spread of the coronavirus. The Office for National Statistics said lockdown measures were in place in Britain for a larger part of this three-month period than they were for other economies. Britain was relatively slow in introducing a national lockdown compared with most of its European neighbors. It started in earnest in late March and the government didn’t begin lifting the broadest restrictions until mid-June. Its lockdowns also affected a greater share of the population for a longer period of time than the state-by-state shutdowns in the United States.
A monthly breakdown showed the British economy did pick up in June, climbing 8.7 percent from May as construction activity resumed and consumer spending rebounded. Still, the Bank of England said last week it didn’t expect the recovery to be complete until the end of 2021.
In an effort to keep the recovery from stalling, the government is encouraging people to return to work in offices and it is planning for schools to reopen next month. The Treasury also spent more than 53 million pounds ($69 million) last week as part of a stimulus plan paying for discounts for meals eaten in restaurants and pubs on Mondays, Tuesdays and Wednesdays this month.
A venture backed by the owner of Barneys New York has won a bid to buy Brooks Brothers, America’s oldest apparel company, for $325 million.
Sparc Group LLC, a venture including Authentic Brands, the new owner of Barneys, and Simon Property, the biggest mall operator in the United States, will save at least 125 Brooks Brothers stores as part of the agreement.Brooks Brothers, a 200-year-old menswear retailer, filed for bankruptcy protection last month. It has struggled with declining sales in recent years as many in the corporate world have opted for a more casual look.
The brand was among several high-profile retailers, including J.C. Penney, Neiman Marcus and J. Crew, whose businesses were unable to weather the sales slump resulting form the coronavirus pandemic.
A court hearing to approve the sale is scheduled for Friday, Brooks Brothers in a statement on Tuesday, and the deal is expected to be completed by the end of this month.
Authentic and Simon initially made a “stalking horse” offer of $305 million, setting a price floor for bids in the bankruptcy auction.