Coronavirus and the economic impacts on the UK: 21 May 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 and the latest indicators for the UK economy and society: 21 May 2020

• Of businesses in the UK who responded they were continuing to trade between 20 April and 3 May 2020, 6% responded they had restarted trading in the last two weeks.

• Of businesses continuing to trade, 61% of businesses reported a decrease in turnover outside of normal range in England, compared with 66% in Wales, 65% in Scotland and 63% in Northern Ireland between 20 April and 3 May 2020.

• The accommodation and food services activities sector had the largest proportion of the workforce furloughed across businesses who have not permanently stopped trading, at 78%, in the period 20 April to 3 May 2020.

• The most popular government schemes applied for by businesses who have not permanently stopped trading between 20 April and 3 May 2020, were the Coronavirus Job Retention Scheme and the Deferring VAT Payments Scheme, at 76% and 59% respectively.

• Of all businesses who have not permanently stopped trading, 4% reported they had no cash reserves at all.

These are the final results from Wave 4 of the Business Impact of Coronavirus (COVID-19) Survey (BICS) for the period 20 April to 3 May 2020, which closed on 17 May 2020.

Of the 6,196 businesses that responded (out of a sample size of 18,506) to BICS Wave 4, there were 79% of businesses who reported continuing to trade between 20 April and 3 May 2020, while 20% reported they had temporarily closed or paused trading. This differed little between the size of businesses.

A small number of businesses (much less than 1%) also responded that they had permanently ceased trading in the period 20 April to 3 May 2020.

Using a form of regional apportionment, it is possible to provide an indication of the different proportions across the various countries within the UK. This is based on businesses that have a regional presence within one or more of the countries. The sample size for the number of businesses in Northern Ireland has increased from previous waves. Further details on the regional apportionment and sample can be found in Sections 9 and 10.

The proportions of trading varied across the regions, with the greatest proportion of businesses continuing to trade in London and the South East, both at 84%.

The lowest proportions of businesses continuing to trade were 74% in Northern Ireland and 79% in Wales.

The main sectors to report the largest percentages of businesses temporarily closing or pausing trading for the period were the arts, entertainment and recreation, and the accommodation and food service activities sectors, at 80% and 78% respectively.

Water supply, sewerage, waste management and remediation activities (97%) and the professional, scientific and technical activities (96%) sectors had the largest proportions of businesses responding that they were continuing to trade. Alongside these, 95% of all responding businesses within each of the human health and social work activities (private sector businesses only), information and communication, and transportation and storage sectors responded that they were continuing to trade.

The accommodation and food services activities, construction and manufacturing sectors reported the largest percentages of businesses to have restarted trading in the period 20 April to 3 May 2020, at 19%, 15% and 12% respectively.

Of those businesses who indicated they had temporarily closed or paused trading during the period 20 April to 3 May 2020, 99% reported the closure or pause started more than two weeks ago. The only industries in which some businesses indicated the closure or pause had started in the last two weeks were within: professional, scientific and technical services (8%); transportation and storage (7%); administrative and support service activities (2%); and the manufacturing sector (2%).

Of the businesses that responded they were continuing to trade (4,916 businesses), 31% reported that their financial performance had not been affected in the period 20 April to 3 May 2020.

The following section analyses financial performance of businesses who indicated continuing to trade and figures are a proportion of all those businesses continuing to trade.

Turnover categories have been combined for presentational purposes, but the breakdown is available in the detailed dataset in Section 8.

At a UK level, 61% of all businesses continuing to trade reported their turnover had decreased outside of normal range between 20 April and 3 May 2020.

The North East was the region that had the greatest proportion of businesses that saw a decrease in turnover with 72%, and the lowest proportion of businesses with turnover unaffected at 20%. In contrast, London saw the lowest proportion of businesses that saw a decrease in turnover with 58%, and the highest proportion of businesses with turnover unaffected at 34%.

Of those businesses who were continuing to trade, the main sectors to have reported that their turnover decreased by more than 50%, relative to the sample within each industry, were the accommodation and food service activities sector (61%), the arts, entertainment and recreation sector (43%) and the construction sector (43%).

The information and communication sector and the human health and social work activities sector (non-public sector businesses only) reported the largest percentages of businesses who responded that their turnover had been unaffected in the period, at 55% and 60% respectively.

The main sectors to have reported that their turnover increased outside of normal range, and were continuing to trade relative to the sample within each industry, were wholesale and retail trade (10%) and manufacturing (5%).

Of those businesses continuing to trade and whose turnover was outside of normal range, 99.8% attributed the coronavirus (COVID-19) as a reason for their turnover being outside of its normal range.

Of businesses who exported goods or services in the past 12 months and whose financial performance was outside of normal expectations, 78% reported exporting during the coronavirus (COVID-19) pandemic.

Of businesses who imported goods or services in the past 12 months and whose financial performance was outside of normal expectations, 79% reported importing during the coronavirus pandemic.

Of businesses who exported goods or services during the coronavirus pandemic, were continuing to trade, and whose financial performance was outside of normal expectations (898 businesses), 72% reported that their business is exporting, but less than normal, while 18% reported that exporting had not been affected.

Of businesses who imported goods or services during the coronavirus pandemic, were continuing to trade, and whose financial performance was outside of normal expectations (1,174 businesses), 60% reported that their business is importing, but less than normal, while 28% reported that importing had not been affected.

A more detailed analysis on the impact of Coronavirus (COVID-19) on exporting and importing by UK businesses for the period 20 April to 3 May 2020 will be published on the ONS website on the 22 May 2020.

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 complexities 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.

For those businesses who have responded, and are continuing to trade, apportioned by employment size:

• 22% of the workforce had been furloughed under the terms of the UK government’s Coronavirus Job Retention Scheme; of which the accommodation and food service activities sector and construction sector had the highest proportions, 57% and 40% respectively
• 71% of the workforce were still working as normal for the period between 20 April and 3 May 2020
• 4% of the workforce were off sick or in self-isolation because of the coronavirus (COVID-19)

As a proportion of businesses who were continuing to trade, 39% reported laying off staff in the short-term and 32% reported reducing working hours as the most common measures being taken to cope with the impact of the coronavirus on the workforce.

Figure 7 presents the proportion of the workforce being furloughed or made redundant relative to all businesses who have not permanently stopped trading. This includes all those continuing to trade and all those who responded they have temporarily closed or paused trading between 20 April and 3 May 2020.

For surveyed businesses who have not permanently stopped trading, apportioned by employment size:

• 31% of the workforce had been furloughed under the terms of the UK government’s Coronavirus Job Retention Scheme; of which the accommodation and food service activities sector had the highest proportion with 77%
• the transportation and storage sector had the highest proportion of the workforce being made redundant across all industries, at 1% between 20 April and 3 May 2020
• for all other industries who responded, less than 1% of the workforce had been made redundant between 20 April and 3 May 2020

Businesses that responded they had temporarily closed or paused trading were also asked independently what proportions of their workforce had been furloughed or made redundant between 20 April and 3 May 2020. Of businesses that had temporarily paused or ceased trading, apportioned by employment size:

• 82% of the workforce were furloughed
• less than 1% of the workforce had been made redundant
• 18% of the workforce had other arrangements between 20 April and 3 May 2020

These data are based on the same methods of proportions of the workforce as in the analysis of Furloughing of workers across UK businesses: 23 March 2020 to 5 April 2020 for Wave 2 final results and the same method can be found in Wave 3 final results.

The following section presents percentages relative to all businesses who have not permanently stopped trading. This includes all those continuing to trade and all those who responded they have temporarily closed or paused trading between 20 April and 3 May 2020.

Of all surveyed businesses who had not permanently stopped trading, 85% had applied for at least one government scheme.

The most popular government schemes applied for were the Coronavirus Job Retention Scheme and the Deferring VAT Payments Scheme, at 76% and 59% respectively.

There is minimal difference between businesses with fewer than 250 employees and greater than 250 employees between schemes applied for, apart from the England and devolved government-funded small business grant or loan schemes.

Of businesses who have not permanently stopped trading, 10% of businesses with fewer than 250 employees had applied for a small business grant or loan in England, compared with 7% of businesses with greater than 250 employees; 4% of businesses with fewer than 250 employees applied for a government-funding small business grant or loan in the devolved administrations, compared with 2% of businesses with greater than 250 employees.

Of businesses who have not permanently stopped trading, 80% of businesses in Wales have applied for the Coronavirus Job Retention Scheme, compared with 79% in Scotland, 76% in England and 74% in Northern Ireland. Generally, businesses in Wales and Scotland have applied for more of these initiatives than businesses in England and Northern Ireland.

Of businesses who have not permanently stopped trading, those operating within Wales indicated the highest percentages of businesses applying to government schemes, across all schemes available, out of all the country breakdowns.

The human health and social work activities sector, and the education sector were the top two industries that indicated the highest percentage of businesses not applying for any of the government schemes on offer, at 47% and 36% respectively.

The accommodation and food service activities sector was consistently the sector indicating the largest proportion of businesses applying for the government schemes available.

Of those surveyed businesses who have not permanently stopped trading and had received funding from a government scheme, 80% reported that the funding they received from these schemes helped the business to continue trading in some way, with 51% continuing to trade but at a lower capacity. Across all industries, 8% reported that the funding was not sufficient to enable the business to continue trading. Caution should be taken when interpreting these responses since businesses were not asked to specify in what way government funding had affected their trading capacity, for example, relative to the prevention of having to cease trading or in terms of how they continued to trade.

Of all businesses continuing to trade (4,916 businesses), 93% reported they had the ability to meet business demands in the last two weeks of the survey period. This did not differ between employment size for businesses with fewer than 250 employees or those with 250 or more employees, 93% and 94% respectively.

The industry indicating the lowest percentage of businesses continuing to trade reporting they were able to meet business demands in the last two weeks was the accommodation and food service activities sector, at 90%, with 3% reporting they could not meet business demands and the remaining 7% in the industry not sure.

The industry reporting the highest proportion of businesses indicating the workforce could not meet business demand was in manufacturing, at 7%.

The following section presents percentages relative to all businesses who have not permanently stopped trading. This includes all those continuing to trade and all those who responded they have temporarily closed or paused trading between 20 April and 3 May 2020.

In Wave 4, businesses who have not permanently stopped trading were also asked how long they thought their cash reserves would last.

Cash reserve categories between 0 and 6 months have been combined for presentational purposes, but the breakdown is available in the detailed dataset found in Section 8.

Of the responding businesses, 43% had cash reserves to last between zero to six months, while 28% of businesses reported they had cash reserves to last more than six months and 4% reported that they did not have any cash reserves, with the remainder unsure.

There was a difference between businesses with fewer than 250 employees and those with 250 employees or more in terms of how long they indicated their cash reserves could last.

Of businesses who have not permanently stopped trading, and had 250 employees or more, 33% indicated they had cash reserves to last more than six months, compared with 25% of businesses with fewer than 250 employees.

The water supply, sewerage, waste management and remediation activities, and accommodation and food service activities sectors were the two industries reporting the largest proportion of businesses indicating they had no cash reserves across all employment size bands, at 9% for both industries.

The accommodation and food service activities sector, and the arts, entertainment and recreational services sector were the two industries reporting the highest proportion of businesses indicating they had cash reserves to last zero to six months, at 60% and 57% respectively.

While the education sector, and information and communication sector reported the highest proportion of businesses indicating they had the cash reserves to last more than six months, at 49% and 47% respectively.

At a country level, Northern Ireland has the highest proportion of businesses with less than six months of cash reserves at 46%, higher than any other region. Scotland has the highest proportion of businesses with more than six months of cash reserves at 34%.

Access to BICS-related microdata

The ONS approach for BICS microdata is that it will be released using the Secure Research Service (SRS) beginning in the week of 25 May. After this point, the BICS microdata for each wave will be released on a rolling basis once the publication of each wave is completed.

The microdata will be confidentialised and not disclose any specific business.

Only researchers accredited under the Digital Economy Act are able to access data in the Secure Research Service (SRS). You can apply for accreditation through the Research Accreditation Service (RAS) and will have to have relevant academic or working 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). The UK Statistics Authority have published an example project application for guidance.

In order to access the SRS, you must also have to work for an organisation with an Assured Organisational Connectivity agreement in place.

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 4 data relate to the period 20 April to 3 May 2020. The survey questions are available in Business Impact of Coronavirus (COVID-19) Survey questions: 20 April 2020 to 3 May 2020.

There were several additional questions in Wave 4 that are new to the BICS from previous waves. These include information on trading status in the last two weeks; international trading; refinement of information of government schemes; and businesses cash reserves.

The different experiences of businesses during the coronavirus

In the final results of Wave 4, of 18,506 businesses surveyed, 6,196 businesses (33.5%) responded.

The Wave 4 survey was live for the period 4 May to 17 May 2020 and businesses were asked about their experience for the two-week survey reference period 20 April to 3 May 2020. Dependent on responses to certain questions, businesses are asked different questions. The various response populations included within this release are indicated in Table 3.

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 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-Departrmental 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.

The MBS covers UK for production and only Great Britain for services. Retail sales 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 Inter-Departmental Business Register (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.

Sample

There has been an additional sample boost of 1,000 businesses to Wave 4 of BICS. These businesses are primarily located in Northern Ireland in order to produce more robust estimates because of limited coverage in previous waves. Because of an increase in the sample for Northern Ireland this might impact on the estimates provided in this release from previous waves of BICS.

Only the businesses that have responded to Wave 4 of the Business Impact of 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.

The sample is more indicative of a panel of medium to large businesses with only a very small representation of those businesses with an employment of fewer than 100 employees.

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.

This gives a total of 18,506 businesses in the sample; with a split of 7,326 in employment for 250 or more employees and 11,180 for employment between 0 and 249. This breaks down further for 1,816 for employment between 0 and 99 employees; and 9,364 for employment between 100 and 249. Based on the achieved response rates for the different size bands, the data for the smaller sized businesses should be treated with caution.

Response rates for these size bands are available in the detailed Business Impact of 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 coronavirus 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 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.

These data should not be used in place of official statistics. The survey was designed to give an indication of the impact of the coronavirus on businesses and a timelier estimate than other surveys.

The data from Wave 4 of the new fortnightly Business Impact of Coronavirus (COVID-19) Survey (BICS) cover the period 20 April to 3 May 2020, across all business sectors covered by the Monthly Business Survey (including Retail Sales Index and construction).

We do not recommend comparison between the latest data from BICS and previous releases because of changes in the questionnaire and additional questions. Further analysis is currently being undertaken to allow this for future publications.

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. For example, there were 1,021 businesses that responded they were continuing to trade in Wave 4 that did not respond in Wave 3. Conversely only 985 businesses stated they were continuing to trade in Wave 3 but did not respond in Wave 4.

Publication of coronavirus (COVID-19) related data

We will be publishing this bulletin on a fortnightly basis. This is to ensure we are meeting user needs for more timely data. We will be adding new data and experimental indicators as and when data become available each week.

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