UK faces skills shortage as COVID-19 splits job market, McKinsey says

November 16, 2020

LONDON (Reuters) – Britain will face a growing skills shortage over the next decade if it does not start retraining and reskilling workers for the shift to a digital-based economy which has been sped up by the COVID-19 pandemic, a McKinsey report said on Monday.

The consultants said their analysis showed 94% of the workforce lacked skills they will require in 2030.

The pandemic had polarised the job market with some skills already in shortage, such as those needed in e-commerce and supply chain analytics, while low-skilled jobs lost during the crisis were unlikely to return, the report showed.

Some of the jobs most at risk include sales roles, retail assistants, receptionists and waiters, traditionally done by part-time staff and often by younger workers.

“Without concerted action by employers, two-thirds of the UK workforce could lack basic digital skills by 2030, while more than 10 million people could be under-skilled in leadership, communication, and decision-making,” the report said.

Britain has long struggled with low productivity levels, with output particularly poor among the lowest-paid jobs, partly due to a lack of training.

The Organisation for Economic Co-operation and Development said in October participation in lifelong learning was higher than the European average but had declined in recent years and in-work training had fallen since the 2008 financial crisis.

Britain’s economy has been hit very hard by the pandemic. Gross domestic product plunged by 20% in the second quarter.

Martin Sorrell, one of Britain’s best-known executives, said last week that Britain could take five to 10 years to properly recover because the financial hit will sap the economy of the firepower that it needs to rebuild for Brexit.

(Reporting by Kate Holton; Editing by William Schomberg)

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Apple, Tesla jump as stock splits take effect

Apple CEO Tim Cook greets customers at the grand reopening of Apple’s flagship Apple Fifth Avenue retail store on September 20, 2019 in New York City.

Taylor Hill | Getty Images

Shares of Apple and Tesla rose sharply on Monday, the first day after their recently announced stock splits took effect, as investors continued to pile into the popular names.

Apple advanced 4% and was the best-performing component in the Dow Jones Industrial Average. Tesla, meanwhile, jumped around 10%.

Monday’s gains are just the latest in a string of strong performances since the two companies announced they would be splitting their stocks.

Apple said July 30 its board approved a 4-for-1 stock split. Since then, the stock is up more than 32%. Tesla announced a 5-for-1 stock split on Aug. 11 and the stock has skyrocketed more than 70% since then.

However, legendary investor Leon Cooperman thinks these run-ups on the back of stock-split announcement are a troublesome sign for the market.

“Look at Tesla and Apple: Everybody understands that [stock] splits don’t create value,” Cooperman, the founder of Omega Advisors, told CNBC’s “Squawk Box” on Monday. “My dad once told me if you gave me five singles for a $5 bill, I’m no better off.”

Monday’s gains in Apple and Tesla come amid high volume as smaller traders are able to snap up shares in both companies at a much lower price point than Friday.

Through the first hour and  a half of Monday’s session, Apple had traded 82.7 million shares, which is roughly 46% of the stock’s 30-day volume average of 178.588 million. Tesla shares had exchanged hands 37.4 million times, more than half of its 30-day volume average of 73.369 million.

This year, smaller traders have been more actively participating in the market as commission-free online brokerage Robinhood grows in popularity. But Cooperman sees this as a potential sign of being overheated.

“I see signs of euphoria creeping into the market: the IPO SPAC market is one, [and] the craziness in many of the stocks that the Robinhood crowd has latched onto,” Cooperman said. “You see a Kodak go from $1.50 to $60 and from $60 to $6 in a very short period of time … and when you look into it, it’s the Robinhood crowd taking it up.”

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Pinnaroo loses health clinic as COVID-19 border closure splits rural community

Nurse practitioner Di Thornton helps her rural patients with chronic disease management, medical needs and COVID-19 tests — but she’s been told she’s not an essential worker.

Her application for an exemption to cross South Australia-Victoria border was rejected on Tuesday afternoon, and from Friday the doors of her Mallee Border Health Centre in Pinnaroo, SA, will close, because five of her seven staff live in Victoria.

The closure will leave Pinnaroo without GP, physiotherapy, podiatry, skin cancer, diabetes and mental health services.

“I feel devastated and really worried for our client base,” Ms Thornton said.

“I am really concerned what that’s going to do for them.

“Mental health [issues] are already on the increase.”

The border check at Summerton Road, near Pinnaroo.(ABC Riverland: Jessica Schremmer)

Shock at healthcare decision

From Friday, SA will tighten its border with Victoria and cross-border community members will lose their exemptions to travel between the states.

Farmers with properties that straddle the border, along with Year 11 and 12 students, have been told they will be given exemptions — but other residents will need to apply for essential travel permits.

Ms Thornton said she was shocked by the decision to deny healthcare workers exemptions.

“Disbelief, I think is probably the one that comes up,” she said.

SA Premier Steven Marshall said despite the impact, an exemption should not be made solely for Mallee Border Health Centre.

“That will be a decision that will be made by clinicians,” he said.

“If there are other staffing arrangements that need to be made on our side of the border, then that’s precisely what we’ll do.

“But as we have heralded now for two weeks, there is a changed situation as of tomorrow that we’ve put in place, on a temporary basis, to keep our state safe.”

A woman stands behind three children sitting at a desk and colouring in.
Katharine Daniel with children Isaac, Amelia and Jacob, who will be unable to attend school from Friday.(ABC News: Jessica Schremmer)

‘Devastated and sick’

Teachers and students cross the border in both directions to attend both Pinnaroo Primary School and Murrayville Community College.

The towns are only 26 kilometres apart, but from Friday that access will be cut off, forcing schools to operate with reduced staff on campus while providing resources for students unable to attend class.

Siblings Amelia, Jacob and Isaac Daniel live on a farm that straddles the border, but their home is 500 metres inside Victoria, which means they will no longer be able to go to school at Pinnaroo.

“It means I might not get to come back to school here, because I’m in Year 7,” 12-year-old Amelia said.

Their mother, Katharine Daniel, is a physiotherapist who works with Ms Thornton at the Pinnaroo health clinic.

She said she was worried about the impact on the children’s education and the family’s livelihood.

“Just devastated and sick, to be honest,” she said.

A man standing in front of a wall with colourful canvasses.
Pinnaroo Primary School principal Sunyl Vogt is concerned about the impact of the border closure on students and staff.(ABC News: Jessica Schremmer)

Schools lose staff, students

Pinnaroo Primary School principal Sunyl Vogt said the school would lose three staff, including one teacher and four students.

He was concerned about the mental wellbeing of the community.

“Seeing police, armed forces, in the street on a regular basis, kids are not sure what to think, whether they can still trust a policeman,” Mr Vogt said.

Murrayville Community College is also bracing for the impact.

Six of the school’s 18 staff and a quarter of the student population come from South Australia.

The school has established a learning hub at Pinnaroo to support its SA students, but principal Natasha Mundie was concerned about the impact if the border closure remains in place after Victorian schools reopen for classroom learning.

“It’s still going to be a massive disadvantage for those students when we go back to face-to-face teaching if they aren’t able to return,” she said.

A student works at a desk as a teacher kneels alongside and smiles.
Murrayville Community College student Davyd gets support from principal Natasha Mundie at the learning hub in the Pinnaroo Lutheran Church hall.(ABC Riverland: Jessica Schremmer)

Pinnaroo loses shops, workers

Two businesses have already closed their doors along the main street of Pinnaroo because their owners live just across the Victorian side of the border.

Guy Badman, who operates a coffee shop and is the chairman of the Pinnaroo Action Group, says the impact of the border closure will be widespread.

“My wife is a teacher at the school and my kids come here for school as well, so we’re heavily involved in the local community,” he said.

A man closing a door with a closed sign on it.
Pinnaroo cafe owner Guy Badman has been forced to shut up shop.(ABC News: Jessica Schremmer)

‘Changing sides’ not viable

Earlier this week local MP Adrian Pederick suggested cross-border residents would need to “choose a side” and should consider moving to South Australia to maintain their livelihoods.

But residents said Victorians had been told they cannot simply move to South Australia.

Instead they want greater communication, understanding and a more workable solution.

“What they need to look at is a bubble proposal,” Ms Thornton said.

“I put it together last week and sent it far and wide.

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Will Apple and Tesla make stock splits great again?

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“I can’t recall them commenting on a stock split or considering it in any way,” Romanoff said.

A reason why Shopify may want to keep its current price level, he said, is to actually avoid some retail investors, particularly day traders, so that the stock can be a little less volatile.

One positive for companies to consider is the immediate boost to share prices that an announcement has proven to generate. Apple is up nearly 20 per cent since it announced the split. Tesla is up more than 18 per cent.

A split doesn’t alter the value of an investment. What it does do is drive up more interest from investors who believe that once Apple’s stock is split and begins to trade near US$100 again, the group of retail investors that bemoaned their ability to buy shares at levels above US$400 will finally have their chance.

“It’s a psychology thing,” Yarbrough said.

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According to Nasdaq chief economist Phil Mackintosh, large cap stocks that have issued splits between 2012 and 2018 outperformed by 2.5 per cent directly after the announcement and an additional 2.5 per cent over the 12 months after the split was performed.

“When a stock becomes harder to trade it trades at a discount to what its optimal valuation is,” Mackintosh said. “I hope (stock splits) are back. We’ve done a bunch of research that shows it’s in the companies’ best interests.”

Mackintosh pointed to widening spreads — the difference between the bid and the offer — as a problem that can be addressed with stock splits. Spreads are wider for higher-priced stocks, Mackintosh said; the more this is the case, the more it eats into returns. Splitting a stock brings spreads back into check and improves the tradeability of stocks, he said.

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Ravensthorpe residents frustrated with new WA regional checkpoints, say it splits town in two

Residents of a town on the West Australian South Coast say the state’s new regional borders have split their town in two, with some people forced to travel through police checkpoints multiple times a day as they head to and from home.

As of Monday the Ravensthorpe Shire, 500 kilometres south-east of Perth, became part of the broader Goldfields-Esperance region as the State Government reduced the amount of regional borders from 13 to four as it entered Phase 2 of the roadmap to recovery following strict COVID-19 lockdowns.

Ravensthorpe is one of the most western towns in the new Goldfields-Esperance region.

But, as checkpoints have been set-up just 2km to the west of the town centre, residents outside of town have said it has caused stress and inconvenience as they have been stopped for simple trips to the local supermarket.

One local, Sharon, who did not give her surname, said the border checkpoint took her by surprise.

“No celebrations for us, just stress,” she said.

Erica, who works at the Ravensthorpe IGA, says she is hearing many frustrated customers talking about the checkpoints.

“If any locals go past, for instance going to work … they have to show their pass. And they have to do that going back and forwards.”

It has also prompted confusion about whether or not people who lived west of the checkpoint needed to apply for a permit.

No permits required

WA now has four regional borders, reduced from 13.(ABC News: Jon Daly)

Police Superintendent for the Great Southern, Ian Clarke, said residents who lived within the Shire would not have to apply for a G2G Pass.

He said residents of Ravensthorpe would be waved through checkpoints as police became familiar with their vehicles.

“Certainly, as time goes on, the [police officers] will know who is a local travelling through and they’ll be waved through pretty quickly,” Superintendent Clarke said.

He said the location had been chosen as it captured both northern and western travellers who were travelling into the region via the South Coast Highway or Newdegate-Ravensthorpe Road, and it was also a safer part of the road to set-up a block.

“It’s really been put in the best location we could find to provide a wide-open space, safety for our officers but also safety for the community travelling through there,” Superintendent Clarke said.

“It largely captures all the travellers that will be travelling through there so that we can comply with the job that we need to do to look after those regional boundaries.”

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