Understanding the business impacts of local and national restrictions, UK: March 2021

• Since early January 2020, the percentage of single-site businesses currently trading has picked up slightly in both Wales and Scotland, though the proportion of their workforce on furlough remains higher than in early January.
• Scotland has consistently had the highest proportion of its single-site businesses’ workforce on furlough leave, compared with other UK countries since early December 2020.
• Single-site businesses across the UK are more likely to have less than three months of cash reserves compared with businesses with multiple sites.
• Workers in single-site businesses in the hospitality and tourism sector are approximately four times more likely to be on furlough leave (63%), compared with single-site businesses across all industries (16%) in mid-March 2021, with single-site businesses in hospitality and tourism in Northern Ireland having the highest likelihood (85%) among the UK countries.

This article uses the microdata from the Business Insights and Conditions Survey (BICS) to help build understanding on business insights and impact on the sub-national UK economy. This update extends our previous analysis to include results up to Wave 26 of BICS, covering the reference period 2 November 2020 (Wave 18) to 7 March 2021 (Wave 26).

To produce sub-national insights, we focus on those UK businesses which have a single business site only. Overall, single-site businesses represent 98% of all businesses, and approximately half of total UK turnover and employment. This analysis is based on a sample of approximately 27,000 single-site businesses across the UK. More detail on the sample and single-site methodology can be found in Section 12 and in our first sub-national BICS article published in early December 2020.

The results in this release are likely to reflect both structural differences between different countries and regions of the UK, but also differences in the nature and timing of restrictions that have been put in place to reduce the spread of the coronavirus (COVID-19).

The interactive tool in Section 9 allows users to explore how business insights and impact differ by geography, based on single-site weighted Wave 26 BICS results.

In the following sections, caution should be taken when interpreting country or region by industry results as response rates in some cases can be quite low and results can be volatile. Though, we have tried to avoid any loss of quality by combining industries into sectors where appropriate.

Figure 1: Since the initial impact of the coronavirus restrictions in early January 2021, the percentage of single-site businesses currently trading has increased the most in both Wales and Scotland

Percentages based on single-site businesses, broken down by country, between Wave 21 and Wave 26, UK, 29 December 2020 to 21 March 2021

Notes:

1. Weighted single-site results, Wave 21 and Wave 26 of the Office for National Statistics’ Business Insights and Conditions Survey.
2. Businesses currently trading: single-site businesses currently trading, as a percentage of all single-site businesses; Wave 21 (29 December 2020 to 10 January 2021) and Wave 26 (8 March to 21 March 2021); weighted by count.
3. Cash reserves: single-site businesses with three months of cash reserves or less, as a percentage of single-site businesses not permanently stopped trading; Wave 21 (29 December 2020 to 10 January 2021) and Wave 26 (8 March to 21 March 2021); weighted by turnover.
4. Workforce on furlough: proportion of the workforce on furlough leave, of single-site businesses not permanently stopped trading; Wave 21 (14 to 27 December 2020) and Wave 26 (22 February to 7 March 2021); weighted by employment.
5. Net turnover balance: calculated by subtracting the percentage of single-site businesses currently trading experiencing a decrease in turnover from the percentage of single-site businesses currently trading experiencing an increase in turnover, all divided by the total percentage of single-site businesses currently trading; Wave 21 (14 to 27 December 2020) and Wave 26 (22 February to 7 March 2021); weighted by turnover.
6. Workforce on furlough and Net turnover balance: Businesses were asked for their experiences for the reference period. However, for questions regarding the last two weeks, businesses may respond from the point of completion of the questionnaire.
7. Response rates vary across countries and between waves. Low response can affect the interpretation of these estimates.

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Further geographic and industry breakdowns over time can be found in our interactive map in Section 9 and in our accompanying dataset.

This section provides insights into the percentage of single-site businesses currently trading, by location and by sector.

The percentage of single-site businesses currently trading across the UK fell from 84% in late December 2020 to 70% in early January 2021, with the introduction of new coronavirus restrictions in all four nations. The percentage of single-site businesses currently trading has since increased slightly to 74% in early March 2021.

Wales saw the largest fall in the percentage of single-site businesses currently trading between late December 2020 and early January 2021, falling from 81% currently trading to 58%. Since early January 2021, the percentage of single-site businesses in Wales currently trading has gradually increased to 70% but remains the country with the lowest percentage of single-site businesses currently trading.

Compared with other UK countries, Wales has a larger proportion of its single site businesses in industries that temporarily close or pause trading whenever tight restrictions are introduced (for example, in the wholesale and retail trade industry and the accommodation and food service activities industry). See Table 4 for a detailed industry composition by UK country, based on the number of single site businesses in each country.

Scotland also saw a large fall in the percentage of single-site businesses currently trading between late December 2020 and early January 2021, falling from 82% currently trading to 64%. Since then, Scotland has also seen a gradual increase in the percentage of single-site businesses currently trading from early January to early March 2021, to 70%, similar to levels seen in Wales.

The percentage of single-site businesses currently trading in England and Northern Ireland has remained broadly stable since January 2021, at around 73%.

It is important to note that some businesses may have shut over the Christmas period with or without new coronavirus restrictions in place. Estimates in this release are not adjusted for seasonal or calendar effects.

Figure 3: Wales saw the largest percentage point increase in the percentage of single-site businesses currently trading for all sectors from early January to early March 2021

Percentage point change in the percentage of single-site businesses currently trading, broken down by country and by sector, between Wave 21 and 26, weighted by count, UK, 29 December 2020 to 21 March 2021

Notes:

1. Weighted single-site results, Wave 21 and Wave 26 of the Office for National Statistics’ (ONS’) Business Insights and Conditions Survey (BICS).
2. For presentational purposes, “has been trading for more than the last two weeks” and “started trading within the last two weeks after a pause in trading” have been combined to “currently trading”.
3. For quality purposes, industries have been collated to construction, production (including: 2-digit SIC 5 to 39, inclusive), and services (including: 2-digit SIC 45 to 98, inclusive).
4. Country names have been shortened and simplified for presentational purposes.
5. Response rates vary across countries and between waves. Low response can affect the interpretation of these estimates.

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Single-site businesses in the construction sector in Wales saw the largest percentage point increase in businesses currently trading from early January to early March 2021, across all countries and all sectors. This is partly because of Wales’ construction sector being at a lower base in early January 2021 compared with other countries, likely because of seasonal effects as well as coronavirus-related restrictions.

Overall, Wales saw the largest percentage point increase in the percentage of single-site businesses currently trading for all sectors from early January to early March 2021, when compared with the other UK countries.

Single-site businesses in the production sector in Scotland also saw a 15 percentage point increase in the percentage of single-site businesses currently trading. And Scotland was the only other country where the services sector increased by more than 1 percentage point.

The percentage point increase in the percentage of single-site businesses currently trading in the services sector in Wales was driven by the administrative and support service activities industry and the wholesale and retail trade industry, which increased by 25-percentage points and 23 percentage points respectively.

Meanwhile, in Scotland, the percentage point increase in the percentage of single-site businesses currently trading in the services sector was driven by the administrative and support service activities industry and the information and communication industry, which increased by 25 percentage points and 15 percentage points respectively.

Figure 4: In early March 2021, the East of England, the South West and the East Midlands had the highest percentages of single-site businesses currently trading

Currently trading, as a percentage of all single-site businesses, broken down by region, weighted by count, UK, 16 November 2020 to 21 March 2021

Notes:

1. Weighted single-site results, Wave 18 to 26 (November 2020 to February 2021) of the Office for National Statistics’ (ONS’) Business Insights and Conditions Survey (BICS).
2. Weighted single-site estimates are available from Wave 14 onwards. However, quality of results was improved from Wave 18 (November 2020) onwards following a sample redesign increasing our coverage for all businesses.
3. For presentational purposes, “has been trading for more than the last two weeks” and “started trading within the last two weeks after a pause in trading” have been combined to “currently trading”.
4. Region names have been shortened and simplified for presentational purposes.
5. Data are plotted in the middle of the two-week period of each wave.
6. Response rates vary across regions and between waves. Low response can affect the interpretation of these estimates.

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The introduction of national coronavirus restrictions in England from 4 January 2021 saw the West Midlands, London and the North East experiencing the largest percentage point falls in single-site businesses currently trading from late December 2020 to early January 2021.

In early March 2021, the East of England, the South West and the East Midlands had the highest percentages of single-site businesses currently trading, at 78%, 77% and 77% respectively.

However, London has seen the largest percentage point increase in the percentage of single-site businesses currently trading from early January to early March 2021, increasing by 8 percentage points, from 62% currently trading to 70%.

The percentage point increase in the percentage of single-site businesses currently trading in the North West, the East Midlands and the South West between early January and early March 2021 was driven by the construction sector.

Conversely, the percentage point increase in the percentage of single-site businesses currently trading in the West Midlands, London and the East of England between early January and early March 2021 was driven by the production sector.

There was little movement between early January and early March 2021 in the services sector in any region, with the most notable being the 8 percentage point increase in London. This was driven by the professional, scientific and technical activities industry and the accommodation and food service activities industry.

Further geographic and industry breakdowns over time can be found in our interactive map in Section 9 and in our accompanying dataset.

This section provides insights into the proportion of the workforce of single-site businesses not permanently stopped trading that are on full or partial furlough leave, by location and by sector.

The proportion of single-site businesses’ workforce on furlough leave across the UK gradually increased from early December 2020 to late January 2021.

Before coronavirus restrictions were introduced in late December 2020, all four countries saw the lowest proportion of their single-site businesses’ workforce on furlough leave in early December 2020, at 11% across the UK.

The proportion of single-site businesses’ workforce on furlough leave reached a high in all four countries in late January 2021, at 17% across the UK. Since then, there has been a small decrease in the proportion of single-site businesses’ workforce on furlough leave across all four countries, dipping to 16% across the UK.

In general, since early December 2020, Scotland has consistently had the highest proportion of its single-site businesses’ workforce on furlough leave compared with the other UK countries. On average, it has had 3 percentage points more of its single-site businesses’ workforce on furlough leave than that at the UK level.

Compared with other UK countries, Scotland has a larger proportion of its single site businesses’ workforce in industries that have a higher rate of furlough (such as, the accommodation and food service activities industry) and a lower proportion from industries with lower rates of furlough (such as, information and communication). See Table 5 for a detailed industry composition by UK country, based on the total employment in single site businesses.

It is important to note that Business Insights and Conditions Survey (BICS) furlough estimates by country provide only a partial picture. Other estimates such as Coronavirus Job Retention Scheme (CJRS) statistics suggest that Scotland has generally had a slightly lower take-up rate of the furlough scheme than the UK as whole, instead of a higher take-up as we suggest in this analysis. Part of the reason to why there are discrepancies is that BICS’ furlough by country estimates are based on businesses with single sites only, while CJRS estimates consider businesses with multiple sites as well as single sites. Other reasons to why BICS furlough estimates and HM Revenue and Customs) (HMRC’s) CJRS estimates differ are outlined in Comparison of furloughed jobs data, UK: March 2020 to January 2021.

Most of the UK single-site businesses’ workforce on furlough leave are employed in the services sector (for example, in the accommodation and food service activities industry and the arts, entertainment and recreation industry). Figure 6 shows how Scotland and Wales have a much higher proportion of their single-site businesses’ workforce in the services sector on furlough leave (at above 25%) compared with England and Northern Ireland (at below 20%).

Figure 7: Single-site businesses in London had the highest proportion of their workforce on furlough leave in early March 2021

Proportion of workforce on furlough leave, of single-site businesses not permanently stopped trading, broken down by region, weighted by employment, UK, 2 November 2020 to 7 March 2021

Notes:

1. Weighted single-site results, Wave 18 to 26 (November 2020 to February 2021) of the Office for National Statistics’ (ONS’) Business Insights and Conditions Survey (BICS).
2. Weighted single-site estimates are available from Wave 14 onwards. However, quality of results was improved from Wave 18 (November 2020) onwards following a sample redesign increasing our coverage for all businesses.
3. Region names have been shortened and simplified for presentational purposes.
4. Data are plotted in the middle of the two-week period of each wave.
5. Response rates vary across regions and between waves. Low response can affect the interpretation of these estimates.
6. Businesses were asked for their experiences for the reference period. However, for questions regarding the last two weeks, businesses may respond from the point of completion of the questionnaire.

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Figure 7 shows that, of the English regions, the South West, the North West, the East Midlands and Yorkshire and The Humber had the lowest proportions of their single-site businesses’ workforce on furlough leave in early December 2020 before coronavirus restrictions were introduced, all at less than 10%. These regions have a higher proportion of their single-site businesses’ workforce working at their normal place of work, compared with levels typical across England.

Since then, all regions in England have seen an increase in the proportion of their single-site businesses’ workforce on furlough leave between early December 2020 and late February 2021. The East Midlands (11%) and South West (12%) had the lowest proportion of their single-site businesses’ workforce on furlough leave in late February, compared with 16% at the UK level.

London has consistently had the highest proportion of its single-site businesses’ workforce on furlough leave since comparable estimates began in early November 2020, rising from 15% in early December 2020 to 20% in late February 2021. Our estimates also show that London has a significantly lower proportion of its single-site businesses’ workforce working at their normal place of work and a significantly higher proportion working remotely, compared with the UK level.

Further geographic and industry breakdowns over time can be found in our interactive map in Section 9 and in our accompanying dataset.

For an overview of the similarities and differences between the fortnightly BICS furlough estimates and HMRC's CJRS data, over the period March 2020 to January 2021, please see Comparison of furloughed jobs data, UK: March 2020 to January 2021.

This section provides insights into single-site businesses’ financial performance, by location and by sector, with a focus on single-site businesses that experienced a decrease in turnover, compared with normal expectations for the time of year.

In Wave 26 (22 February to 7 March 2020), across all UK single-site businesses currently trading:

• 42% experienced a decrease in turnover compared with normal expectations for this time of year
• 40% experienced no impact on turnover
• 9% experienced an increase in turnover compared with normal expectations for this time of year
• 9% were not sure

The percentage of all businesses in the UK experiencing a decrease in turnover, compared with normal expectations for the time of year, gradually fell throughout summer 2020, from a high of 65% in early June to just below 50% in mid-August. This was mainly because of coronavirus (COVID-19) lockdown restrictions being eased throughout the summer months, meaning that business activity was able to increase. Since November 2020, there has been little change in the percentage of all businesses in the UK experiencing a decrease in turnover, despite lockdown restrictions being introduced throughout this period.

Single-site estimates (shown in Figure 8 from November 2020 onwards), show that a notably lower percentage of currently trading single-site businesses in Northern Ireland are experiencing a decrease in turnover, compared with the other UK countries. This lower percentage of single-site businesses experiencing a decrease in turnover is true across all sectors in Northern Ireland. Other Business Insights and Conditions Survey indicators suggest that single-site businesses in Northern Ireland are more likely to have remained open throughout the autumn and winter months and have also had a lower proportion of the workforce on furlough.

All UK countries have started to see an increase in the percentage of single-site businesses experiencing an increase in turnover, compared with normal expectations for the time of year, rising from approximately 1 in 20 single-site businesses in January to 1 in 10 by late February.

Further geographic and industry breakdowns over time can be found in our interactive map in Section 9 and in our accompanying dataset.

This section provides insights into businesses’ cash reserves, by location and by sector.

In Wave 26 (8 to 21 March 2021), across all UK single-site businesses not permanently stopped trading:

• 6% had no cash reserves
• 4% had less than one month of cash reserves
• 25% had between one and three months of cash reserves
• 16% had between four or six months of cash reserves
• 32% had more than six months of cash reserves
• 18% were not sure

Across all sites, in late September 2020, 26% of businesses has three months of cash reserves or less. By late November 2020, this had increased to 31%, and has since remained broadly stable at that level.

Figure 9 shows (from late November 2020 onwards) that single-site businesses across the UK were generally more likely to have three months of cash reserves or less (approximately 4 percentage points more likely), compared with all sites in the UK (that is, including businesses with multiple sites). This is partly because of smaller businesses making up a greater proportion of single-site estimates, and smaller businesses being more likely to report lower cash reserves than larger businesses.

Of the English regions, the North East generally has the largest percentage of single-site businesses with three months of cash reserves or less (averaging at 39% since November 2020). In contrast, London generally has the lowest percentage of single-site businesses with three months of cash reserves or less (averaging at 32% since November 2020).

In terms of UK sectors, the construction sector has consistently had a notably higher percentage of single businesses with three months of cash reserves or less, compared with single-site businesses in the production sector and the service sector.

Further geographic and industry breakdowns over time can be found in our interactive map in Section 9 and in our accompanying dataset.

This section focuses on data from the hospitality sector, which has been particularly affected because of coronavirus-related restrictions. The hospitality sector includes the following industries:

• accommodation
• food and beverage service activities
• travel agency, tour operator and other reservation service and related activities
• creative, arts and entertainment activities
• libraries, archives, museums and other cultural activities
• sports activities and amusement and recreation activities

Following the introduction of coronavirus restrictions in December 2020, the hospitality sector saw a decrease from 64% of single-site businesses currently trading in mid-December 2020 to 41% currently trading in early January 2021. This has since increased to 48% currently trading in mid-March 2021, but it still low compared to 74% of single-site businesses currently trading across all industry in the UK at the same time.

Figure 10 shows how the workforce of single-site businesses in the hospitality and tourism sector are approximately four times more likely to be on furlough leave (63%), compared with single-site businesses across all industries (16%) in early March 2021.

In particular, single-site businesses in Northern Ireland and in the hospitality and tourism sector have consistently had a greater proportion of their workforce on furlough compared with other UK countries.

Single-site businesses in the hospitality and tourism sector are also more likely to have three months of cash reserves or less, at 43% in mid-March 2021, compared with 35% across all industries.

Further geographic and industry breakdowns over time can be found in our interactive map in Section 9 and in our accompanying dataset.

The interactive map shows experimental sub-national results (at a NUTS 2 level) using weighted Wave 26 single-site data: with insights into businesses currently trading, proportion of the workforce on furlough leave, businesses experiencing a decrease in turnover, and businesses with three months of cash reserves or less.

In some cases, responses are low and so should be taken into consideration when interpreting the results. Areas with 10 or less responses have been suppressed for disclosure purposes. Number of responses per geographic area across all variables can be found in the accompanying dataset.

Figure 11: Interactive map highlighting the business impact of the coronavirus pandemic in Wave 26

Percentages based on single-site businesses, broken down by region, UK, 22 February to 21 March 2021

Notes:

1. Weighted single-site results, Wave 26 of the Office for National Statistics’ Business Insights and Conditions Survey.
2. Currently trading: single-site businesses currently trading, as a percentage of all single-site businesses; 8 March to 21 March 2021; weighted by count.
3. On partial or furlough leave: proportion of the workforce on furlough leave, of single-site businesses not permanently stopped trading; 22 February to 7 March 2021; weighted by employment.
4. Decrease in turnover: single-site businesses experiencing a decrease in turnover, as a percentage of single-site businesses currently trading; 22 February to 7 March 2021; weighted by turnover.
5. Cash reserves: single-site businesses with three months of cash reserves or less, as a percentage of single-site businesses not permanently stopped trading; 8 March to 21 March 2021; weighted by turnover.
6. On partial or furlough leave and Decrease in turnover: Businesses were asked for their experiences for the reference period 22 February to 7 March 2021. However, for questions regarding the last two weeks, businesses may respond from the point of completion of the questionnaire (8 to 21 March 2021).
7. Response rates vary across regions and between waves. Low response can affect the interpretation of these estimates.
8. Areas with 10 or less responses have been supressed for disclosure purposes.

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Coronavirus

Coronaviruses are a family of viruses that cause disease in people and animals. They can cause the common cold or more severe diseases, such as COVID-19.

COVID-19

COVID-19 is the name used to refer to the disease caused by the SARS CoV-2 virus, which is a type of coronavirus. The Office for National Statistics (ONS) takes COVID-19 to mean presence of SARS-CoV-2 with or without symptoms.

Furlough

Furlough is a temporary absence from work allowing workers to keep their job while the coronavirus (COVID-19) pandemic continues.

Reporting unit

The business unit to which questionnaires are sent is called the reporting unit. The response from the reporting unit can cover the enterprise as a whole or parts of the enterprise identified by lists of local units.

The Business Insights and Conditions Survey (BICS) is voluntary and may only reflect the characteristics of those that responded; the results are experimental.

The BICS survey provides timely insights into the impact on businesses’ financial performance, workforce, prices, trade and business resilience over a fortnightly period, and the survey questions are available.

Subnational BICS estimates

Subnational BICS estimates have been created by using the results collected in the fortnightly business survey (BICS). Each survey return from each reporting unit is then applied to the reporting unit's one local site. We have removed businesses with multiple sites from the sample and results in this analysis are based on single-site businesses only (as identified on the IDBR). Sections 2 and 3 of our first sub-national BICS article outlines in detail the methodology behind our single-site subnational estimates and its impact compared with previously published results encompassing all businesses.

Aggregates of Nomenclature of Territorial Units for Statistics (NUTS1) regions such as the UK or England may have higher or lower response proportions than any of their constituent regions because of differences in the sample composition in terms of company workforce.

Because the larger aggregate regions, such as the UK or England, generally have a larger proportion of smaller companies, if there is a substantial difference between the response proportions of larger and smaller companies, this will be reflected in the top-line figures.

Weighting

Single-site estimates in this release are weighted, ensuring estimates are representative of all single-site businesses. A detailed description of the weighting methodology and its differences to unweighted estimates is available in Business Impact of Coronavirus (COVID-19) Survey (BICS): preliminary weighted results.

Weighted estimates for Scotland for businesses with greater than nine employees are available from the Scottish Government.

Single site sample

While the single-site approach is not representative of all UK businesses (as it excludes businesses with multiple sites), weighted single-site estimates are representative of all UK single-site businesses and approximately 98% of all businesses (and half of total UK turnover and employment). Tables 2 and 3 show how the composition by region and industry when using the single sites approach holds up, when compared with the all businesses sample.

Results in the accompanying dataset cover single-site estimates for Waves 14 to 26 only. In the future, we hope to develop further insights on multi sites in the context of weighted regional estimates.

With the sample redesign from Wave 18 onwards, estimates for more questions should also be possible, allowing for insights at both a regional and local authority level.