Business insights and impact on the UK economy: 17 June 2021

• The percentage of UK businesses currently trading has remained consistent from late May 2021 to early June 2021, at 87%, the joint highest percentage of businesses currently trading since comparable estimates began in June 2020.

• The proportion of businesses' workforce who are reported to be on furlough leave has fallen from around 20% in late-January 2021 to 7% in late-May 2021, the lowest proportion since the furlough scheme began; this return from furlough corresponds to the highest proportion of the workforce working at their normal place of work, at 62%.

• Despite recent improvements in the proportion of businesses trading, many companies were trading below their usual capacity, with 31% of businesses reporting turnover lower than normal; in the arts, entertainment and recreation industry this figure is over 60%.

• The proportions of businesses experiencing challenges in importing and exporting are broadly unchanged since January 2021, with additional paperwork remaining as the top challenge faced by businesses for importing and exporting.

• Around 1 in 10 businesses who sent goods from Great Britain to Northern Ireland reported a decrease in volumes.

• 21% of businesses currently trading reported that the prices of materials, goods or services bought in the last two weeks had increased more than normal, compared with 8% of currently trading businesses that reported the price of goods or services sold had increased more than normal.

More commentary on the impacts of the coronavirus (COVID-19) pandemic on the UK economy and society is available on the following pages:

• Economic activity and social change in the UK, real-time indicators

• Coronavirus and the social impacts on Great Britain

The data presented here are final results from Wave 32 of the Business Insights and Conditions Survey (BICS), which was live for the period 1 to 13 June 2021.

For questions regarding the last two weeks, businesses were asked for their experience for the reference period 17 to 30 May 2021.

For experimental single site weighted regional estimates up to Wave 30 (3 to 16 May 2021), please see Understanding the business impacts of local and national restrictions, UK: May 2021.

Figure 1: Headline figures from the Business Insights and Conditions Survey

Notes:

1. Final weighted results, Wave 7 to Wave 32 of the Office for National Statistics' (ONS') Business Insights and Conditions Survey (BICS).

2. Weighted estimates are available from Wave 7 onwards only. The sample redesign in Wave 7 improves our coverage for the small-sized businesses, allowing for weighted results to be truly reflective of all businesses.

3. Data are plotted in the middle of the two-week period of each wave.

4. Trading status: for presentational purposes, currently trading categories and paused trading categories have been combined.

5. Financial performance: for presentational purposes, decreased turnover categories and increased turnover categories have been combined, and the option "Not sure" has been removed.

6. Business resilience: for presentational purposes, cash reserves categories between zero and three months have been combined, and the option "Not sure" has been removed.

7. Workforce: for presentational purposes, the options "On sick leave or not working because of coronavirus (COVID-19), self-isolation or quarantine", "Made permanently redundant" or "Other" have been removed.

8. Financial performance and Workforce: 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.

Download the data

The percentage of businesses currently trading has remained consistent from late May 2021 to early June 2021, at 87%. This is the joint highest percentage of businesses currently trading since comparable estimates began in June 2020, and higher than in late September and early October 2020, when fewer coronavirus (COVID-19) restrictions were in place across the UK.

Businesses currently trading were asked how their turnover compared with normal expectations for this time of year:

• the percentage of businesses experiencing a decrease in turnover has fallen to 31% in late May 2021 - the lowest percentage recorded since comparable estimates began in June 2020

• the percentage of businesses experiencing an increase in turnover has risen slightly to 14% in late May 2021

The proportion of businesses' workforce that are reported to be on furlough leave (the Coronavirus Job Retention Scheme) has fallen from around 20% in late-January 2021 to 7% in late May 2021, as a result of coronavirus restrictions continuing to be relaxed across the UK. This is the lowest proportion of businesses' workforce reported to be on furlough leave since the furlough scheme began.

The 7% of businesses' workforce reported to be on furlough leave in late May 2021 equates to approximately 1.7 million people. This number is based on multiplying the BICS weighted furlough proportions by HM Revenue and Customs (HMRC) Coronavirus Job Retention Scheme (CJRS) official statistics eligible employments¹ for only those industries covered by the BICS sample.

Notes for: Headline figures

1. An "employment" in the HMRC CJRS Official Statistics is defined as anyone who meets the scheme criteria set out within the published guidance, and data come from the whole population of HMRC CJRS claims (those applied) and Pay As You Earn (PAYE) Real Time Information systems (RTIs). The assessment of whether a person was employed on the qualifying dates is based on the methodology used for the joint HMRC and ONS statistics release, Earnings and employment from Pay As You Earn Real Time Information.

Trading status

The transportation and storage industry had the lowest percentage of businesses currently trading at 76%. This is driven by a proportion of businesses that reported they are temporarily closed or paused trading within freight transport by road and removal services. It compares with 87% of businesses currently trading across all industries.

The following data show the largest increases in the percentages of businesses currently trading, from Wave 31 to Wave 32:

• the education industry (higher education and private sector businesses only) increased from 79% to 89%, driven by a 25 percentage points increase in the proportion currently trading in sports and recreation education, this could be linked to many schools being on half-term during the survey live period

• the accommodation and food service activities industry increased from 83% to 92%

• the real estate activities industry increased from 86% to 94%

For both the accommodation and food services industry and the arts, entertainment and recreation industry, these are the highest percentages of businesses currently trading since comparable estimates began in June 2020.

The arts, entertainment and recreation industry has seen a large percentage point increase in the proportion of businesses currently trading, rising from 66% of businesses currently trading in early to mid-April 2021, to 91% in early June 2021.

It should be noted that the definition of currently trading used within the Business Insights and Conditions Survey (BICS) refers to the business currently trading in any capacity. It does not cover whether a business has completely reopened to trading at full capacity, experienced before the coronavirus (COVID-19) pandemic or if the business is operating at a reduced level of capacity but is still trading.

Financial performance

The percentage of currently trading businesses reporting that turnover is lower than normal has fallen from 33% to 31%. However, in the arts, entertainment and recreation industry, the majority of businesses (64%) continue to experience lower turnover than usual for the time of year given ongoing restrictions, which particularly impact that sector.

In Wave 32 the accommodation and food service activities industry had the second-highest percentage of businesses experiencing a decrease in turnover, compared with normal expectations for this time of year. However, it experienced the largest movement from Wave 31 to Wave 32:

• the percentage of businesses in this industry experiencing a decrease in turnover fell from 63% to 48%

• the percentage of businesses in this industry experiencing an increase in turnover rose from 14% to 26%

These figures in Wave 32 for the accommodation and food service activities industry are the lowest and highest recorded respectively, since comparable estimates began in June 2020. They are driven by the reopening of the industry following further easing of restrictions in May 2021. However, some social distancing measures were still in place, resulting in a decrease in turnover compared with normal expectations for this time of year for some businesses.

Workforce

The percentage of the workforce reported to be on furlough fell to 7%, the lowest since the furlough scheme began. Notable falls in the proportion on furlough leave between Waves 31 and 32 were seen in:

• the other service activities industry (such as hairdressers and other beauty services), which fell from 26% to 15%

• the accommodation and food service activities industry, which fell from 21% to 14%

• the arts, entertainment and recreation industry, which fell from 26% to 21%

For both the accommodation and food service activities industry and the arts, entertainment and recreation industry, these are the lowest proportions of businesses' workforce on furlough leave since the furlough scheme started.

The proportion of workforce estimated to be working at their normal place of work continued to rise in early June 2021, at 62%; this is the highest record we have seen since comparable estimates began in June 2020.

The accommodation and food service activities industry shows the largest increase in the proportions of businesses' workforce working at their normal place of work, from 71% to 78%. The increase is because of the further relaxation of coronavirus regulations in May 2021 enabling additional businesses to reopen, such as restaurants and pubs.

One-fifth (21%) of businesses currently trading reported that the prices of materials, goods or services bought in the last two weeks had increased more than normal price fluctuations. This was unchanged from Wave 31, but has increased considerably from the 14% of businesses at the end of 2020 (Wave 21, 14 to 27 December 2020).

Industries with the highest proportion of businesses reporting increases in prices of materials, goods and services bought in the last two weeks were construction (44%), accommodation and food service activities (36%), manufacturing (32%) and wholesale and retail trade (31%).

By contrast, only 8% of businesses currently trading reported that they had increased the price of goods or services sold. This was broadly unchanged from 7% in Wave 31, but up from 4% in Wave 21.

Figure 5 shows how the fortnightly turnover estimates from the Business Insights and Conditions Survey (BICS) compare with the published UK monthly gross domestic product (GDP) estimates.

The BICS captures qualitative responses from companies about the direction of change in their turnover performance, without asking for the level of change. This compares with GDP’s use of a wide range of data sources, including quantitative data from the Monthly Business Survey. Therefore the qualitative nature of the BICS helps indicate the direction of change, but the magnitude may differ from GDP. There are other conceptual and scope differences between these two estimates, including:

• the BICS calculation is based on a net balance approach, using the final unweighted BICS results for Waves 1 to 6 and weighted BICS estimates for Wave 7 onwards, using the turnover variable

• the BICS does not cover public sector (such as local and central government, and the NHS) and non-market activity (such as public administration, non-private schools and universities)

• GDP is seasonally adjusted, whereas the BICS is not

Figure 5: Comparing the fortnightly net turnover balance estimates from BICS with the UK monthly GDP estimates

Net balances of businesses currently trading against monthly GDP estimates, UK, 1 February 2020 to 30 May 2021

Notes:

1. Final unweighted results, Wave 1 to Wave 6, and final weighted results, Wave 7 to Wave 32, of the Office for National Statistics' (ONS') Business Insights and Conditions Survey (BICS); businesses currently trading.

2. Weighted net balances have been calculated from Wave 7 onwards only. The sample redesign in Wave 7 improves our coverage for the small-sized businesses, allowing for weighted results to be truly reflective of all businesses.

3. Net turnover balance is given by subtracting the percentage of businesses reporting a decrease in turnover, from the percentage of businesses who reported an increase in turnover, then scaled up using a scaling factor for visual purposes. GDP and BICS estimates use different scales (one is an index, the other percentage points). Hence, to align them onto the same graph, we apply a scaling factor to BICS net balances so users can easily compare these two related trends.

4. Monthly gross domestic product (GDP) publications are available.

5. BICS data are plotted in the middle of the two-week period of each Wave and GDP are plotted in the middle of the reference month.

Download the data

Of currently trading businesses, 10% had exported and 11% imported in the last 12 months and reported how their exporting or importing compared with normal expectations for this time of year. These businesses were asked about the challenges they had experienced with exporting or importing in the last two weeks.

The proportion of currently trading businesses experiencing a challenge in importing and exporting increased from December 2020 until January 2021, to be over 50%, and has remained broadly stable since then. The data suggest businesses are more likely to be experiencing an importing challenge than an exporting challenge.

The proportion of currently trading businesses' experiencing the top three challenges in importing and exporting has remained broadly stable between Wave 31 and Wave 32.

Further industry and size band breakdowns of trade questions are available in the dataset.

Businesses that are currently trading were asked whether they had sent goods between Great Britain (GB) and Northern Ireland (NI) in the last 12 months.

Across all industries, 5% of currently trading businesses had sent goods from GB to NI, and 1% from NI to GB in the last 12 months.

These businesses were asked a series of questions about their experience sending these goods over a two-week reference period (17 to 30 May 2021).

Of businesses currently trading and who had sent goods from GB to NI in the last 12 months, 95% reported that the main route they used for sending these goods was from GB directly to NI.

Table 1 shows how the volume of goods being sent from GB to NI and NI to GB has changed in the last two weeks, reported by businesses that had sent, or intended to send, goods in the last two weeks.

Of the businesses that are currently trading and have sent goods in the last two weeks from GB to NI, and changed volume compared with what businesses would normally send, the reasons given are:

1. increased delays, at 53%

2. decreased demand for goods, at 51%

3. increased costs, at 40%

4. the coronavirus pandemic, at 39%

Additional data on these questions and businesses' experiences sending goods between Great Britain and Northern Ireland, including full industry breakdowns, are available in the accompanying dataset.

These data are not official statistics but have been developed to deliver timely indicators to help understand the impact of the coronavirus (COVID-19) pandemic and other events in a timely way.

The BICS microdata for Waves 1 to 31 can now be accessed via the Secure Research Service (SRS). The BICS microdata for each wave are released on a rolling basis in the week following the publication of each wave.

Access to microdata

The microdata are confidentialised and do not disclose any specific business.

Only researchers accredited under the Digital Economy Act are able to access data in the SRS. You can apply for accreditation through the Research Accreditation Service (RAS). You need to have relevant academic or work experience and must successfully attend and complete the assessed Safe Researcher Training.

To conduct analysis with microdata from the SRS, a project application must be submitted to the Research Accreditation Panel (RAP). To access the SRS, you must also work for an organisation with an Assured Organisational Connectivity agreement in place.

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.

EU exit transition period

The EU exit transition is the period agreed in the UK-EU Withdrawal Agreement in which the UK is no longer a member of the EU but continues to be subject to EU rules and remains a member of the single market and customs union. When the UK left the EU on 31 January 2020, it entered the transition period. The transition period came to an end on 31 December 2020.

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.

More quality and methodology information on strengths, limitations, appropriate uses, and how the data were created is available in the BICS QMI, published 20 May 2021.

The Business Insights and Conditions Survey (BICS) is voluntary and the results are experimental.

The results are based on responses from the voluntary fortnightly BICS, which captures businesses' views on financial performance, workforce, prices, trade, and business resilience. The Wave 32 survey was live for the period 1 to 13 June 2021. For questions regarding the last two weeks, businesses were asked for their experience for the reference period 17 to 30 May 2021. The survey questions are available.

Consultation on release time of statistics

The Office for Statistics Regulation (OSR) is undertaking a review into whether the 9:30am release time stated in the Code of Practice for Statistics meets the needs of users. During the pandemic, exemptions were granted to allow the release of market sensitive statistics at 7:00am. The OSR welcomes views about the release time of official statistics by Friday 25 June 2021, please send comments to: regulation@statistics.gov.uk.

Coverage

The Monthly Business Survey (MBS) covers the UK for production and only Great Britain for services. The RSI and Construction are Great Britain-focused. Therefore, the BICS will be UK for production-based industries but Great Britain for the other elements of the economy covered.

The industries covered are:

• non-financial services (includes professional, scientific, communication, administrative, transport, accommodation and food, private health and education, and entertainment services)

• distribution (includes retail, wholesale and motor trades)

• production (includes manufacturing, oil and gas extraction, energy generation and supply, and water and waste management)

• construction (includes civil engineering, housebuilding, property development and specialised construction trades such as plumbers, electricians and plasterers)

The following industries are excluded from the survey:

• agriculture

• public administration and defence

• public provision of education and health

• finance and insurance

For more information on the methodology of producing the Business Insights and Conditions Survey (such as weighting), please see the BICS QMI.