FOR IMMEDIATE RELEASE
This year sees Christmas Day and Boxing Day fall on a weekend, the result of which means that these two festive bank holidays are pushed back to the Monday 27th and Tuesday 28th December 2016.
Every year, England and Wales have eight bank holidays - one of the world’s lowest allocations of communal days off. India has a staggering 18 days and our European neighbors France and Spain both enjoy a generous fourteen. Only Mexico has lower with seven per annum and our friends in Scotland have nine.
Where do bank holidays originate from?
Bank holidays go back to 1871 and were founded by Sir John Lubbock, Liberal MP and banker. The purpose was to give the working classes and Bank workers additional time off to rest from their rigorous job. It was also seen as a way of repaying the national debt.
The cost of bank Holidays
The Centre for Economics and Business Research (CEBR) in 2012 calculated that the cost of giving the British public collective days off work have been totaled at close to £19bn and that each bank holiday sets the UK back £2.3bn in lost productivity.
Only 2.9 percent of the labour force works on Christmas Day, according to the ONS and this doesn’t even take into account the significant drop in productivity experienced by workers on the day (or days) following their Christmas party. This post-party dip is estimated at 50 percent and could possibly be even higher.
Over the three bank holidays (including New Year’s Day), the loss to the economy is almost £7bn which is 0.4% of GDP.
Could bank holidays become a thing of the past?
While 15% of the economy benefits from bank holidays, including pubs and restaurants, about 45% of business suffers as a result of them.
Some Banks (most notably RBS and Natwest) now open on bank holiday Mondays to keep up with the demands of the modern consumer. They are also hoping to use these public holidays to entice more potential customers through the doors, especially those who would usually be restricted by work demands.
It is also thought that if we cancelled the bank holidays over the Christmas period, more people would take the opportunity to travel abroad on holiday instead, removing money from the British economy. Charities would also lose out as generosity increases by 5% in December and, with fewer people around to donate, their income would take a hit.
So who benefits from bank holidays?
We all benefit from the rest the bank holidays give us – perhaps we should be measuring the happiness of our society rather than GDP?
Richard Layard at the London School of Economics suggests that ‘We should measure the happiness of our society instead. While Christmas can be a difficult time for some, overall it would seem to increase happiness. As economists, we find it difficult to put a value on activities like spending time with family, watching your children in a nativity play or supporting the vulnerable in your community. Perhaps it’s because they are priceless.”
According to Ian Cass, Chief Executive of the Forum of Private Business, it's all about the feel good factor. 'Rather than trying to assess the positive and negative value of our UK bank holidays, perhaps we should be measuring the emotional impact of having a day off and the benefits of spending this time with family and friends….preferably not spending the whole time over the turkey discussing the family business,' he concludes.
Merry Christmas everyone!
Notes to Editors:
Information Sources: KPMG, BBC, The Telegraph
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