"The silver lining for the economy is that weve adapted to working effectively from home and we might well see quality of life benefits as a result, as well as the environmental and efficiency boosts."
James Roach, managing partner of WMF
The first Yorkshire FD Survey, conducted by specialist finance recruiter Woodrow Mercer Finance, polled finance heads about how the recent lockdown had impacted their firms.
Of the 61 respondents, 43% expected to escape without redundancies, whilst 35% anticipated laying off up to 10% of their workforce.
Two thirds of those polled indicated that they expected 2020 revenues to be either significantly below (34%) or below (33%) target by the end of the year, with only 10% expecting revenues ahead of projections for the year.
In total, 87% believed that a second lockdown was likely in late 2020 or early 2021, and 31% of businesses were planning to reduce their expenditure on property when their current obligations came to an end.
“The vast majority of Yorkshire businesses haven’t seen much bad debt to date, which is obviously good, and, thankfully, three quarters of the FDs we surveyed think that less than one in ten of all businesses will fail in the recession,” said James Roach, managing partner of Woodrow Mercer Finance.
“Finding the positives in the results isn’t easy though, and there is a general feeling that we haven’t seen the end of the disruption from the pandemic. On the brighter side, over 79% of businesses say employees have been able to work effectively under lock down, and 75% are planning to adopt new working practices as a result of the forced change in working practices since March.”
Job seekers will have to get used to changes in future hiring processes too, with increased vetting of CVs and background checks by almost a quarter (24%) of firms; a keener focus on candidates who could demonstrate self-motivation and organisational skills was cited by 59%; and one in ten firms increasing the use of recruitment professionals to improve their new remote hiring processes.
Almost 9 out of 10 (88%) of the FDs stated that they had taken advantage of the Government’s Coronavirus Job Retention Scheme, with a further 18% having applied for Coronavirus Business Interruption Loans, and one in five (20%) had also received a Bounce Back Loan.
“It is clear that Yorkshire firms have taken advantage of the Government relief schemes, and that has helped mitigate the level of redundancies so far. But with 59% of FDs cutting non-essential spending, and over 83% seeing reduced spend from customers, we know that we haven’t yet seen the full impact of the shock to the economy caused by the pandemic,” said Mr Roach
“The silver lining for the economy is that we’ve adapted to working effectively from home and we might well see quality of life benefits as a result, as well as the environmental and efficiency boosts that reduced commuting has given us. That said, it comes at a huge cost, and most businesses are bracing for a second lockdown. This could deliver the knockout blow for many businesses that have weathered the storm with Government support, but which may be less available in the event of a repeat lockdown.”