Many European governments won plaudits last year for their relatively quick and decisive use of lockdowns to manage the spread of the virus – at least compared with the shambolic pandemic responses seen across the water in the United States and United Kingdom. Yet as we enter 2021, the tables appear to have turned. EU countries are lagging far behind the US and UK in their roll-out of vaccinations. Going forward, a lethargic vaccine roll-out could have significant ramifications for economic activity.

But the lagging nature of data provision means it may be some months before we see any evidence of a performance differential. The latest available data from November remains positive, especially for Germany and its manufacturing sector. Looking in the rear-view mirror, Europe’s fourth quarter activity appears resilient, with export orders relatively strong especially within the eurozone. As the latest lockdown restrictions and Europe’s slow roll-out of vaccines filter through the data, that curve could flatten.

For the UK, on the other hand, the picture could be reversed. Household consumption in the third quarter of 2020 was much lower than on the continent. The reasons can likely be found in differing focuses of fiscal support. While eurozone countries were more active in VAT rate cuts, UK policymakers prioritized financial aid to households –resulting in an increased saving rate of 17% compared with 13% in the EU. The UK economy’s heavy tilt towards services rather than manufacturing (as inFrance and Germany) will not have helped either, with more workers heeding government advice and staying home to work and saving their lunch money.

The UK’s rapid vaccine roll-out stands in stark contrast to their initial bumbling response to the pandemic last year. Combined with UK workers’ high-savings rate last year, the vaccination programme could augur well for a stronger bounce-back this year than their European counterparts.