Coronavirus (COVID-19) Business Intelligence Round-Up

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Business Polling Summary

Westco has recently developed a Business Tracking Survey for our public sector and local authority clients. We have designed this survey in collaboration with the business development teams of some of our clients to ensure that it captures the data that local authorities need to monitor the impact of COVID-19 on the local economy. This Business Tracking Survey:

  • Allows local authorities to assess the health of the local economy and how it has been impacted by COVID-19
  • Identify the specific challenges local businesses face and how councils can address them
  • Is low cost and quick to turnaround

If you would like to discuss how we can successfully launch this survey to support your local economy, please contact our Executive Research Director, Caroline Roper, for more information  (caroline@westcocommunications.com).

In the last couple of weeks, many market research agencies have started to publish the first findings from polls tracking the impact of the coronavirus (COVID-19) pandemic. Below we explore the findings from polling of businesses in the UK. 

The coronavirus (COVID-19) pandemic has already had a significant impact on business. The Government has conducted two waves of the Business Impact of Coronavirus (COVID-19) Survey. Full results for the first wave which took place between 9th and 22nd March are available, while only preliminary results are available for the second wave which ran between 23rd March and 5th April.

Between the 9th and 22nd March around 45% of businesses reported a lower than normal turnover, while a further 42% of businesses said that their financial status was unaffected by the coronavirus (COVID-19) pandemic. In the second wave, 38% of businesses had substantially lower turnover than normal, and a further 17% had levels of turnover that were slightly lower than normal[1]. This suggests that the proportion of businesses that have lower turnover has increased, likely because of the implementation of a full ‘lockdown’ on 23rd March. Accordingly, a survey conducted by the Institute for Directors with business leaders found that around 72% of businesses had seen decreased demand for products and services[2].  

While the full results for Wave 2 of the Business Impact of Coronavirus (COVID-19) Survey conducted by the Government are unavailable, the results of Wave 1 indicate that impact of coronavirus (COVID-19) on turnover varies significantly by industry and size. The table below shows those sectors where the majority of businesses have experienced lower than normal turnover[3]:

Lower than normal turnover

 

Small and Medium Sized Businesses (less than 250 employees)

Large Businesses (more than 250 employees)

Arts, Entertainment and Recreation

91%

86%

Accommodation and Food Services

90%

91%

Information and Communications

60%

53%

Construction

60%

60%

Human Health and Social Work Activities

54%

29%

 

It should be noted that all sectors had businesses which had experienced lower than normal turnover. For example, small and medium sized businesses in the ‘Professional, Scientific and Technical’ sector were the least affected by coronavirus (COVID-19), but 22% of these businesses still reported a lower than normal turnover[4].

These findings reflect significant changes in consumer spending patterns. YouGov’s COVID-19 monitor shows that the only area where the proportion of British residents spending more is greater than the proportion spending less is in ‘groceries’ (35% are spending more, while 21% spending are spending less). Meanwhile 35% of British residents report spending less on ‘entertainment’ compared with 9% spending more and 47% of residents report spending less on clothing compared to 2% spending more[5].

The ‘Accommodation and Food Service’ sector has been particularly badly hit by changes in consumer behaviour. On 26th March YouGov found that 43% report preparing food at home ‘more often’ compared with only 8% on the 12th March. This growth is significantly larger than the increased usage of food deliveries, where only 12% of British residents reported ordering food for delivery on 26th March, compared with 4% on 12th March[6].

In response to the coronavirus (COVID-19) pandemic, the Governments Business Impact of Coronavirus (COVID-19) Survey found that a significant proportion of businesses made it mandatory for their employees to work from home (46%), while worryingly 27% reported reducing staff levels and 29% reported decreasing working hours. Preliminary results from Wave 2 suggest that the proportion of businesses who have reduced staff has increased significantly to 41% amongst those businesses continuing to trade[7].

Perhaps unsurprisingly, different sectors have responded differently. Notably in Wave 1, 52% of businesses in the ‘Accommodation and Food Service’ sector had reduced staff levels by laying off staff in the short term, followed by 39% of businesses in the ‘Administrative and Support Services’, ‘Arts, Entertainment and Recreation’ and ‘Construction’ sectors[8].

How does the Government’s Coronavirus Jobs Retention Scheme factor into this situation?  Well a survey of businesses conducted by the British Chamber of Commerce (BCC), found that 71% of businesses intended to furlough staff[9].

Some surveys suggest that businesses have been slow to access the support available to them. For instance, the Business Impact Tracker conducted by the BCC found that only 15% has successfully accessed grants for small businesses, while a further 12% were unsuccessful (largely because they did not meet the criteria)[10].

Within this context, the financial confidence of businesses is mixed. Overall, 40% of businesses surveyed in Wave 1 were confident that they had the financial resources to operate throughout the coronavirus (COVID-19) outbreak, 16% were not confident and a significant proportion of businesses did not know at that time (44%). It should be noted that Wave 1 of the survey was conducted before the Government announced a range of measures to support businesses. The Institute for Directors has conducted a survey that ran between 20th and 26th March and found that 71% of respondents said that COVID-19 represented a ‘High’ or ‘Severe’ threat to their organisation – unfortunately the IoD did not publish a breakdown of responses over time which could have shown the impact of the announcement of Government measures targeted at businesses[11].

These findings emphasise how important it is for local government to proactively contact businesses to direct them to the support that is available. Councils should prioritise business sectors that have been most affected by the coronavirus (COVID-19) pandemic – notably businesses in the ‘Arts, Entertainment and Recreation’ and ‘Accommodation and Food Services’ sectors. Finally, it is important with businesses who are reducing staff temporarily, that they are encouraged to make use of the Government’s Coronavirus Jobs Retention Scheme to furlough staff rather than lay them off.

Author: Rishi Moulton, Associate Director (Research & Insight) at Westco.

[1] UK Government, ‘Business Impact of Coronavirus (COVID-19) Survey, Wave 1 9-22 March, Wave 2 23 March – 5 April 2020, Base: 4000+ Businesses (Source: https://www.ons.gov.uk/economy/economicoutputandproductivity/output/datasets/businessimpactofcovid19surveybics)

[2] IoD, ‘Covid-19 Survey’, 20-26 March 2020. Base: 710 Business Leaders (source: https://www.iod.com/news-campaigns/news/articles/Gaps-in-coronavirus-support-for-business-need-to-be-filled)

[3] UK Government, ‘Business Impact of Coronavirus (COVID-19) Survey, Wave 1 9-22 March, Wave 2 23 March – 5 April 2020, Base: 4000+ Businesses (Source: https://www.ons.gov.uk/economy/economicoutputandproductivity/output/datasets/businessimpactofcovid19surveybics)

[4] UK Government, ‘Business Impact of Coronavirus (COVID-19) Survey, Wave 1 9-22 March, Wave 2 23 March – 5 April 2020, Base: 4000+ Businesses (Source: https://www.ons.gov.uk/economy/economicoutputandproductivity/output/datasets/businessimpactofcovid19surveybics)

[5] YouGov, ‘COVID-19 Monitor’, 26 March. (https://campaign.yougov.com/webinar-recording-uk.html?utm_medium=Newsletter&utm_source=CTA&utm_campaign=UK_2020_04_COVID-19_Newsletter)

[6] YouGov, ‘COVID-19 Monitor’, 26 March. (https://campaign.yougov.com/webinar-recording-uk.html?utm_medium=Newsletter&utm_source=CTA&utm_campaign=UK_2020_04_COVID-19_Newsletter)

[7] UK Government, ‘Business Impact of Coronavirus (COVID-19) Survey, Wave 1 9-22 March, Wave 2 23 March – 5 April 2020, Base: 4000+ Businesses (Source: https://www.ons.gov.uk/economy/economicoutputandproductivity/output/datasets/businessimpactofcovid19surveybics)

[8] UK Government, ‘Business Impact of Coronavirus (COVID-19) Survey, Wave 1 9-22 March, Wave 2 23 March – 5 April 2020, Base: 4000+ Businesses (Source: https://www.ons.gov.uk/economy/economicoutputandproductivity/output/datasets/businessimpactofcovid19surveybics)

[9] BCC, ‘Coronavirus Business Impact Survey’, 8-10 April, Base: 701 Businesses (source: https://www.britishchambers.org.uk/news/2020/04/bcc-coronavirus-business-impact-tracker-two-thirds-of-respondents-awaiting-funds-from-furlough-scheme-as-payday-approaches)

[10] BCC, ‘Coronavirus Business Impact Survey’, 8-10 April, Base: 701 Businesses (source: https://www.britishchambers.org.uk/news/2020/04/bcc-coronavirus-business-impact-tracker-two-thirds-of-respondents-awaiting-funds-from-furlough-scheme-as-payday-approaches)

[11] IoD, ‘Covid-19 Survey’, 20-26 March 2020. Base: 710 Business Leaders (source: https://www.iod.com/news-campaigns/news/articles/Gaps-in-coronavirus-support-for-business-need-to-be-filled)

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