The scale of the economic collapse brought about by COVID-19 and the public restrictions in place to combat the spread of the infection has been clearly spelled out in a new survey by Chambers Ireland.
A poll of the nationwide network of chambers sought to quantify the impacts of the pandemic on businesses in towns, cities and regions right across the country and it doesn’t make for pleasant reading.
With over 1,100 responses (1,149) to the survey conducted between 3 April and the morning of 6 April 2020 it represents a clear snapshot of the business environment out there.
All corners of Ireland are represented in the responses and the results will inform the advocacy of Chambers Ireland and affiliated chambers, on behalf of businesses throughout the country, and provide guidance to the Government on next steps required to support business through the crisis.
The headline results are:
84% of businesses expect revenue to decline by in excess of 25% in the next three months.
Approximately 25% of businesses expect their revenue to decline by more than 90% over the next 3 months.
Smaller firms are more concerned about loss of revenue and are more likely to expect a 100% reduction in revenue
42% of businesses have closed entirely, and 30% of businesses having closed the public facing offices and are now working from home, of those that have closed, most expect to be closed for 12 weeks.
47% of businesses have laid off staff, with over half of those laying off in excess of 30% of staff
20% of all businesses have laid off their entire staff
76% of businesses owners/operators believe that the 2-month deferral of Commercial Rates payments will not be enough to have any meaningful impact on their business
Most believe that it would need to be a six-month holiday to be of use, with a significant minority believing that the extension would need to be for 12 months
Next Steps/Economic Interventions:
99% of respondents believe that there will be a need for a post – COVID-19 economic stimulus package.
95% of respondents believe that there is a need for liquidity grants to businesses
96% of respondents believe that the measures that have already been introduced will need to have their timelines extended
Commenting on the figures Chambers Ireland Chief Executive Ian Talbot said:
“When we published our first set of results, neither the Temporary Wage Subsidy Scheme nor the tighter restrictions were in place, so we expected that the impact on business would continue to decline.
Therefore, our findings that 84% of businesses, an increase of 11% on two weeks ago, expect a decrease in revenue of more than 25%, should not come as a shock.
However, what our results do show is the gravity of the situation, particularly for many smaller businesses. 25% of those who responded expect revenue to collapse by more than 90%, with one in five businesses laying off all staff.
For those who have closed their operations entirely, most expect to remain closed for at least 12 weeks. Unfortunately, as we’re seeing in other countries, the period of closure is likely to be longer for some businesses.
Should this come to pass, an honest dialogue with Government will be required regarding how the staff and employers who have lost their living will be supported.
Since the outset, we have highlighted the need for far-reaching economic intervention from Government to support local economies and job creators right across the country. We need action on a scale we have not seen before. The unprecedented nature of COVID-19 must be met with an unprecedented response.
This view is shared by our members, where there is almost unanimous agreement that a post-COVID-19 stimulus package will be required and that part of these measures must include the provision of grants for business to help them re-open their doors and restore jobs lost.
Measures already introduced, while critical in the first response to support business, will need to evolve in scale and scope.
For example, the Government’s earlier announcement of a two-month deferral for commercial rates is found to be insufficient by three quarters of businesses responding to our survey.
If a deferral is to have any meaningful impact, it will need to last at least 6 months, if not a full year, as was introduced in the UK. To ensure that Local Authorities can continue to serve communities, this short-fall in funding must be replaced by central Government.”