The CMA has issued a first-of-its-kind analysis examining how well competition is working across the UK economy
Commissioned by the Chancellor and the Business Secretary, the report looks at the state of competition in the UK economy. It is intended to provide a baseline for future analysis and monitoring, by the Competition and Markets Authority (CMA) and others; to inform the work of the CMA; and to contribute to wider public debate on these important issues.
To produce today’s report, the CMA considered the economy as a whole as well as individual sectors, using quantitative and qualitative indicators of how markets are functioning. It analysed key metrics of competition, including entry and exit rates, profitability and market concentration, as well as considering the experiences of consumers.
Although much of the study uses comprehensive analysis covering the last 20 years, with the most recent data from 2018, the CMA has also started assessing early metrics of how the coronavirus (COVID-19) has affected competition.
Key findings include:
In addition, and in order to consider the early effects of the coronavirus pandemic, the CMA placed questions in 2 ongoing Office for National Statistics surveys and considered “business demographic” data: the number of businesses created and closed.
Although it is still early to draw any definitive conclusions about the impact of the pandemic on competition, initial data shows:
Mike Walker, Chief Economic Adviser at the CMA, said:
Throughout this work, the CMA has drawn on the considerable internal knowledge amassed during its day-to-day work of enforcing consumer and competition law, assessing mergers and examining markets. It has also sought the assistance of outside experts and other parts of government; and has set out where it thinks further work is needed.
For more information, and to read the report, visit the State of UK Competition report page.