Coronavirus and the economic impacts on the UK: 16 July 2020

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

• Coronavirus, the UK economy and society, faster indicators: 16 July 2020
• Coronavirus and the social impacts on Great Britain: 10 July 2020

• Of all responding businesses, 85% had been trading for more than the last two weeks, while 4% had started trading again within the last two weeks after a pause in trading.
• Of businesses continuing to trade, 58% reported a decrease in turnover out of normal range, while 12% reported that turnover had increased.
• Of businesses who had not stopped trading and who had a proportion of their workforce furloughed, 41% of businesses reported providing top-ups to furloughed workers' pay on top of the Coronavirus Job Retention Scheme (CJRS).
• Of businesses who had not stopped trading and who had implemented one or more safety measure, 73% reported having increased operating costs.
• Of businesses who had not stopped trading, 47% reported having no or less than six months cash reserves, while 33% reported having more than six months cash reserves.
• Of businesses continuing to trade, 11% reported that stock levels were higher than normal, while 15% reported that stock levels were lower than normal.
• Of businesses continuing to trade, 20% reported there had been more innovation since the coronavirus (COVID-19) pandemic.

Final results from Wave 8 of the Business Impact of Coronavirus (COVID-19) Survey (BICS) are for the period 15 June to 28 June 2020, which closed on 12 July 2020.

Of the 5,527 businesses that responded (out of a sample size of 24,496) to Wave 8 of BICS, 89% of businesses reported continuing to trade as their current trading status, while 11% reported they had temporarily closed or paused trading.

A small number of businesses (fewer than 1%) also responded that they had permanently ceased trading in the period that the survey was live – 29 June to 12 July 2020.

Of all responding businesses:

• 85% had been trading for more than the last two weeks
• 4% had started trading again within the last two weeks after a pause in trading
• 4% had paused trading but intend to restart trading in the next two weeks
• 6% had paused trading and do not intend to restart in the next two weeks

There were three industries where 99% or more of businesses reported continuing to trade (including trading for more than the last two weeks or had started trading again within the last two weeks after a pause in trading) – the water supply, sewerage, waste management and remediation activities sector (100%); the human health and social work activities sector (private sector businesses only) (99%); and the manufacturing sector (99%).

The accommodation and food service activities sector and the arts, entertainment and recreation sector reported the largest percentage of businesses that indicated they had paused trading but were intending to restart in the next two weeks, at 26% and 13% respectively.

Conversely, the arts, entertainment and recreation sector and the accommodation and food services activities sector also reported the largest percentage of businesses indicating that they had paused trading but were not intending to restart in the next two weeks, at 48% and 22% respectively.

Increased turnover categories have been combined for presentational purposes, but the breakdown is available in the detailed dataset in Section 11.

The sectors who had the highest percentage of their businesses reporting that their turnover decreased by more than 50% were the arts, entertainment and recreation sector (53%) and the accommodation and food service activities sector (46%).

The information and communication sector and the human health and social work activities sector (private sector businesses only) reported the largest percentages of businesses who responded that their turnover had been unaffected in the period, at 49% and 46% respectively.

The sector who had the highest percentage of their businesses reporting that their turnover increased was the wholesale and retail trade sector (23%).

The North East was the region that had the greatest proportion of businesses that saw a decrease in turnover with 64%, and the lowest proportion of businesses with turnover unaffected at 17%.

In contrast, Northern Ireland saw the lowest proportion of businesses with a decrease in turnover with 49% and the highest proportion of businesses with turnover unaffected at 28%. However, this may be as a result of low response from businesses with a presence in Northern Ireland at just 13%, compared with the UK response rate of 23%.

Surveyed businesses who have not permanently stopped trading will have differing approaches to the management of employees, whether furloughing staff, working as normal or other scenarios. Because of the complex nature of this, the data in this section primarily focus on proportions of the workforce within responding businesses as opposed to proportion of businesses as is the case for other sections.

The workforce proportions are based on the responses provided by businesses. These are then apportioned to derive proportions of employees in those businesses using the employment recorded for each reporting unit on the Inter-Departmental Business Register (IDBR). This apportionment of workforce methodology used for these data does not involve grossing to make a UK-wide estimation, therefore, the findings should not be treated as representative of the UK workforce.

Across all industries, of all businesses who have not permanently stopped trading, 22% of the workforce had been furloughed under the terms of the UK Government’s Coronavirus Job Retention Scheme (CJRS) (apportioned by employment size). The arts, entertainment and recreation sector and the accommodation and food service activities sector had the highest proportions of furloughed workers, at 72% and 61% respectively.

Across all industries, of all businesses who have not permanently stopped trading, 2% of the workforce were off sick or in self-isolation due to coronavirus (COVID-19) with statutory or company pay.

The remainder of the workforce were either working at their normal place of work (49%) or working remotely (51%). The education sector reported the largest proportion of the workforce working remotely at 86%, while the human health and social work activities sector (private sector businesses only) reported the lowest proportion of the workforce working remotely at 22%.

Across all industries, apportioned by workforce size, less than 1% of the workforce had been made permanently redundant for all businesses not permanently stopped trading.

Broken down by trading status, of those continuing to trade,17% of the workforce had been furloughed under the CJRS, rising to 86% of those who had temporarily closed or paused trading. Of those continuing to trade, the arts, entertainment and recreation sector had the highest proportion furloughed at 52%, while of those businesses temporarily closed or paused trading, the information and communication sector reported the highest proportion of the workforce furloughed, at 92%.

When interpreting the proportion of the workforce estimates returning from remote working or from furlough leave in the last two weeks, consideration of the sectors that had a higher proportion of their workforce furloughed is needed. For example, of businesses continuing to trade, while the education sector reported that 1% of the workforce had returned from furlough in the last two weeks, the total proportion of the workforce on furlough was 10%, compared with 52% in the arts, entertainment and recreation sector.

Of businesses who reported continuing to trade, 8% of the workforce had returned from furlough in the last two weeks, while 4% had returned from remote working to the normal workplace. The construction sector reported the highest proportion of the workforce returning from furlough leave (21%), while the water supply, sewerage, waste management and remediation activities sector reported the highest proportion of the workforce returning to their normal place of work (11%).

Of businesses continuing to trade and who had temporarily closed or paused trading but intend to restart trading in the next two weeks, 6% of the workforce are expected to return from furlough in the next two weeks, while 4% are expected to return to their normal workplace from remote working.

Of those businesses who have not permanently stopped trading and with a proportion of their workforce furloughed, 41% of businesses reported providing top-ups to furloughed workers pay on top of the CJRS. The education sector and the arts, entertainment and recreation sector reported the largest percentage of businesses providing top-ups to furloughed workers, at 78% and 56% respectively.

Of businesses topping up their furloughed workers pay (apportioned by workforce size), an average of 71% of the workforce have their pay topped up. Those businesses within the education sector and the human health and social work activities sector (private sector businesses only) reported the largest proportion of the furloughed workforce receiving top-ups, at 98% and 97% respectively.

For Wave 8, additional questions regarding the operating costs of implementing safety measures were asked to those business who were continuing to trade and who had implemented one or more safety measures. For Figure 8, decreased operating costs categories have been combined for presentational purposes, but the breakdown is available in the detailed dataset found in Section 11.

The three most common measures that businesses who have not permanently stopped trading indicated they were implementing, or were intending to implement, in the workplace were social distancing, hygiene measures, and personal protective equipment (PPE), at 91%, 85% and 80% respectively.

Across all industries, 74% reported having implemented, or intending to implement, all three of the most common safety measures, while 3% reported having implemented, or intending to implement, no safety measures at all.

Further details of additional safety measures are available in the detailed dataset in Section 11.

Of businesses continuing to trade and who had implemented one or more safety measures, 11% reported operating costs had substantially increased and 62% reported they had increased a little. An additional 14% reported their operating costs had stayed the same, while the remainder reported a decrease in operating costs, not sure or not applicable.

The accommodation and food service activities sector had the highest percentage of businesses who reported operating costs had increased significantly (39%), while the information and communication sector had the highest percentage of businesses whose operating costs had stayed the same (24%).

The following section presents percentages relative to all businesses who have not permanently stopped trading.

Figure 9: 80% of businesses who had not permanently stopped trading had applied for the CJRS, while 96% reported to have received the CJRS

Government schemes estimates from the Business Impact of Coronavirus Survey, 15 June to 28 June 2020, UK

Source; Office for National Statistics – Business Impact of Coronavirus (COVID-19) Survey

Notes:

1. Final results, Wave 8 of the Office for National Statistics (ONS) Business Impact of Coronavirus (COVID-19) Survey; businesses who have not permanently stopped trading.
2. Bars may not sum to 100% because percentages less than 1% have been removed for disclosure purposes, rounding and businesses could select multiple schemes – further detail can be found in the detailed dataset in Section 11.
3. All percentages are a proportion of businesses that have not having permanently stopped trading apart from government schemes received, which is a proportion of those that have not permanently stopped trading and applied for the Coronavirus Job Retention Scheme (CJRS) and/or government-backed accredited loans or finance agreements.
4. Businesses were asked for their experiences for the reference period 15 June to 28 June 2020. However, for questions regarding government schemes, businesses may respond from the point of completion of the questionnaire (29 June to 12 July 2020).

Download the data

The accommodation and food service activities sector and the arts, entertainment and recreation sector reported the highest percentage of businesses applying for the CJRS, at 96% and 93% respectively.

Businesses within the water supply, sewerage, waste management and remediation activities sector (100%); the accommodation and food service activities sector (99%); and the arts, entertainment and recreation sector (98%) reported the highest percentage of businesses having received the CJRS.

In Scotland 83% of businesses had applied for the CJRS, compared with 80% in England, 79% in Wales, and 77% in Northern Ireland.

At a UK level, of the businesses that applied for either the CJRS or government-backed accredited loans or finance agreements, 96% had received funds from the former and 18% received funds from the latter. There was little variation between the regions.

In Scotland 15% of businesses had not applied for any of these schemes, compared with 16% in Wales and 18% in England and Northern Ireland.

The accommodation and food service activities sector was the industry that had the highest percentage of businesses using the business rates holiday (79%), deferring VAT payments (78%) and HMRC Time To Pay scheme (32%) initiatives.

Further breakdown by industry of government schemes and initiatives can be found found in the detailed dataset in Section 11.

HM Revenue & Customs (HMRC) has also published estimates on Coronavirus (COVID-19) statistics, looking at data on the CJRS, the Self-Employment Income Support Scheme, and the VAT payments deferral scheme.

Cash reserve categories, in Figures 10 and 11, between 0 and 6 months have been combined for presentational purposes, but the breakdown is available in the detailed dataset found in Section 11.

The accommodation and food services activities sector, the administrative and support service activities sector and the arts, entertainment and recreation sector were the three industries with the highest percentage of businesses indicating they had no cash reserves, at 7%, 5% and 5% respectively.

The accommodation and food services activities sector also had the highest percentage of businesses across all industries indicating they only had cash reserves to last between 0 and 6 months, at 59%, followed by the construction sector and the arts, entertainment and recreation sector, at 54% each.

Conversely, the education sector and the information and communication sector reported the highest percentage of businesses indicating they had cash reserves to last more than six months, at 50% each.

The North East had the lowest proportion of businesses with less than six months of cash reserves at 34%. Wales had the highest proportion of businesses with less than six months of cash reserves at 44%.

Wales and Northern Ireland had the lowest proportion of businesses with more than six months of cash reserves at 30%. The North East had the highest proportion of businesses with more than six months of cash reserves at 40%.

Businesses continuing to trade were asked in Wave 8 how their stock levels had been affected by the coronavirus (COVID-19) pandemic.

Of all businesses continuing to trade, 11% reported that stock levels were higher than normal, while 15% reported that stock levels were lower than normal. 36% of all businesses continuing to trade reported that stock levels had not changed.

The human health and social work activities sector (private sector businesses only) reported the largest percentage of businesses indicating that stock was higher (21%), while the accommodation and food service activities sector reported the largest percentage of businesses (43%) indicating that stock was lower than normal.

For Wave 8, businesses who were continuing to trade were asked questions about how their levels of innovation had been affected by the coronavirus (COVID-19) pandemic.

Of businesses continuing to trade, for all industries, 20% reported there had been more innovation while 8% reported there had been less. An additional 32% reported that innovation had not been affected. The remainder reported not sure or not applicable.

Of businesses continuing to trade, the human health and social work activities sector (private sector businesses only) and the education sector had the highest percentages of businesses who reported there had been more innovation, at 48% and 47% respectively. The manufacturing sector had the highest percentage of businesses reporting there had been less innovation (17%).

Conversely, of businesses who reported innovation had not been affected, the water supply, sewerage, waste management and remediation activities sector and the manufacturing sector had the highest percentages, 43% and 42% respectively.

The Business Impact of Coronavirus (COVID-19) Survey (BICS) is voluntary and may only reflect the characteristics of those that responded; the results are experimental.

The business indicators are based on responses from the voluntary, fortnightly Business Impact of Coronavirus (COVID-19) Survey, which captures business' views on impact on turnover, workforce prices, trade and business resilience. Wave 8 data relate to the period 15 June to 28 June 2020. The survey questions are available in Business Impact of Coronavirus (COVID-19) Survey questions: 15 June to 28 June 2020.

There were several additional questions in Wave 8 that were new to the BICS from previous waves. These included detailed questions on operating costs of implementing safety measures and innovation.

The different experiences of businesses during COVID-19

In the final results of Wave 8, of 24,496 businesses surveyed, 5,527 businesses (22.6%) responded.

The Wave 8 survey was live for the period 29 June to 12 July 2020 and businesses were asked about their experience for the two-week survey reference period 15 June to 28 June 2020. Dependent on responses to certain questions, businesses are asked different questions.

For questions or response options referring to the "last two weeks" or expectations of the "next two weeks", businesses could respond from the point of completion of the questionnaire based on their current experiences. This means that business responses may cover any two-week time period across the following reference periods respectively: 15 June to 28 June 2020 and 29 June to 12 July 2020. More detail on the type of questions asked are available in the detailed dataset in Section 11.

Weighting

Estimates from the Business Impact of Coronavirus (COVID-19) Survey (BICS) are currently unweighted and should be treated with caution when used to evaluate the impact of the coronavirus across the UK economy. Each business was assigned the same weight regardless of turnover, size or industry, and the data in the latest period are preliminary.

Coverage

The approach for the sample design has been to use three standard Office for National Statistics (ONS) surveys, the Monthly Business Survey (MBS), Retail Sales Inquiry (RSI) and Construction, as a sampling frame. Each of these survey samples are drawn from the Inter-Departmental Business Register (IDBR) which covers businesses in all parts of the economy, except those that are not registered for Value Added Tax (VAT) or Pay As You Earn (PAYE), which includes very small businesses, the self-employed, those without employees, and those with low turnover. Some non-profit making organisations are also not registered on the IDBR.

MBS covers UK for production and only Great Britain for services. RSI and Construction are Great Britain focused. Therefore, 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 sectors are excluded from the survey:

• agriculture
• public administration and defence
• public provision of education and health
• finance and insurance

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. Other than for a minority of larger business or businesses that have a more complex structure, the reporting unit is the same as the enterprise.

Where more than one type of economic activity is carried out by a local unit or enterprise, its principal activity is the activity in which most of the people are employed, and it does not necessarily account for 50% or more of the total employment of the unit. There are detailed rules for determining Standard Industrial Classification (SIC) for multiple-activity economic units.

Regional estimates

Regional BICS estimates are produced by taking the survey return from each reporting unit then applying this to the reporting unit's local sites. If a business has a site or several sites (also known as local units) within a country, using information from the IDBR, then this business is defined to have presence there. The business is then allocated once within each region (regardless of the number of sites) and the information provided by the reporting unit as a whole copied and used within each country.

Aggregates of 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. Since 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.

Sample

Only the businesses that have responded to Wave 8 of the Business Impact of Coronavirus (COVID-19) Survey (BICS) are represented in these data, and as such it is not fully representative of the UK as a whole. Currently, we do not apply weighting methods to these data.

The sampling frame used in the BICS was designed to achieve adequate coverage of the listed industries from the monthly business surveys. Coverage and response rate of the medium to largest businesses in terms of total employment is satisfactory to produce estimates on this basis.

To help interpretation of the data, we have presented results based on the number of employees in each business, grouping fewer than 250 employees and those with 250 employees or more.

All businesses with an employment of greater than 250 employees and included within the three monthly surveys (MBS, RSI, Construction) are included in the BICS sample with a random sample of 1% for those with an employment between 0 and 249.

The sample comprises 24,496 businesses with a split of 7,297 in employment for 250 and over and 17,199 for employment between 0 and 249. This breaks down further for 14,503 for employment between 0 and 99, and 2,696 for employment between 100 and 249.

Response rates for these size bands are available in the detailed Business Impact of Coronavirus (COVID-19) Survey (BICS) dataset.

As the sample is selected fortnightly, the same businesses will be selected for at least two waves depending on how many COVID-19 survey selections there are between the selection of these feeder surveys. Because of the randomly selected element, there will be differences in this part of the sample once the feeder surveys have been redrawn. As this is a voluntary survey, businesses may or may not choose to respond to the different waves. Response coverage can be mixed between the different waves.

While we have the ability to align the reporting unit to lower level detail, and also increased detail on the SIC, it is not advisable given the sparseness of response in certain industries and size band.

Business Impact of Coronavirus (COVID-19) Survey

The Business Impact of Coronavirus (COVID-19) Survey (BICS) is voluntary and responses are qualitative, which should be treated with caution, as results reflect the characteristics of those who responded and not necessarily the wider business population.

The survey was designed to give an indication of the impact of the coronavirus on businesses and a timelier estimate than other surveys.

Comparison of waves

Comparison of the proportions of businesses trading status between waves should be treated with caution because of the voluntary nature of the survey, the difference in response rates and dependency on those businesses that only responded in particular waves.

A initial article on Business impact of coronavirus, analysis over time, UK: Waves 2 to 5 captures common businesses responses on how their turnover, workforce, prices, trade and business resilience have been affected in the two-week reference period. These data relate to the period 23 March 2020 to 17 May 2020 (Wave 2 to Wave 5).

An updated bulletin on Insights of the Business Impact of Coronavirus (COVID-19) Survey: 23 March to 5 April (Wave 2) to 1 to 14 June (Wave 7) 2020 analyses business responses on how their turnover, cash flow and workforce have been affected in each two-week reference period.

Publication of coronavirus (COVID-19) related data

This bulletin is published on a fortnightly basis. This is to ensure we are meeting user needs for more timely data.

High-level provisional estimates will be included as part of the Office for National Statistics' (ONS') faster indicators release in the alternative weeks.