HALF of firms across the north's key sectors expect to cut their workforce over the coming months, a new business survey has suggested.
One-in-three businesses across the north’s retail, hospitality and manufacturing sectors believe that their trading and profitability levels will not return to pre-Covid levels ‘until 2022 or beyond.’
The figures were contained in a business recovery survey carried out by Duff & Phelps with Trade NI, the business lobby group made up of Retail NI, Manufacturing NI and Hospitality Ulster.
More than half of the 323 respondents said they are ‘concerned’ or ‘very concerned’ about their performance in the year ahead, with a further 29 per cent saying they are ‘uncertain’.
It found that almost half (48 per cent) of respondents anticipate their employee headcount being lower this time next year. Around two-thirds (65 per cent) expect that their turnover will be lower.
When asked by how much their employee headcount will change by this time next year, one quarter (25 per cent) of businesses predicted that it would be ‘up to 25 per cent lower’, with 17 per cent saying ‘up to 50 per cent lower’ and 6 per cent saying ‘more than 50 per cent’ lower. Only 9 per cent of respondents said their headcount would be higher, with 44 per cent saying it would be ‘similar’.
The survey also revealed how businesses believe government intervention scheme will play a key role in any recovery.
Over two-thirds (69 per cent) said they will call upon government grants or loans, with 51 per cent also relying on employee retention support.
Some 41 per cent will seek to defer HMRC payments, while one quarter (26 per cent) will seek new or additional bank lending and 37 per cent will focus on marketing and promotional development activity.
The overwhelming response came in relation to rates, with three quarters (75 per cent) of businesses saying they will rely on the rates relief scheme in the coming year.
In a statement, Trade NI said: “What comes across very clear from the survey of our respective memberships is the vital importance of the rates holiday and the need to extend it further from April 2021.
“If our economy is to stand any chance of recovery, further rates relief will be needed throughout next year to support our members as we rebuild our shattered economy.”
Davy Elliott from Duff & Phelps said: “It is clear that significant challenges will lie ahead for these businesses across what are among the sectors worst-hit by the coronavirus pandemic.
“Whilst these results are concerning, it is encouraging to note that respondents are proactively taking steps to protect their businesses and boost recovery efforts in the coming year and beyond.”
