Coronavirus and the economic impacts on the UK: 30 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 and the latest indicators for the UK economy and society: 30 July 2020
• Coronavirus and the social impacts on Great Britain: 24 July 2020

• The accommodation and food service activities sector reported the largest percentage of businesses starting to trade within the last two weeks after a pause in trading, at 33%.
• The accommodation and food service activities sector reported the highest proportion of the workforce returning from furlough leave, at 18%, followed by the arts, entertainment and recreation sector and the construction sector, both at 15%.
• Of businesses continuing to trade, the wholesale and retail trade sector had the highest percentage of businesses reporting that their turnover increased, at 22%.
• 38% of businesses continuing to trade reported that capital expenditure had stopped or was lower than normal because of the coronavirus (COVID-19) pandemic.

Final results from Wave 9 of the Business Impact of Coronavirus (COVID-19) Survey (BICS) are for the period 29 June to 12 July 2020, which closed on 26 July 2020.

Of the 5,851 businesses that responded (out of a sample size of 24,493) to Wave 9 of BICS, 93% of businesses reported continuing to trade as their current trading status, while 7% reported they had temporarily closed or paused trading.

A small number of businesses (approximately 1%) also responded that they had permanently ceased trading in the period that the survey was live – 13 July to 26 July 2020.

Of all responding businesses:

• 86% had been trading for more than the last two weeks
• 6% had started trading again within the last two weeks after a pause in trading
• 2% had paused trading but intend to restart trading in the next two weeks
• 5% had paused trading and do not intend to restart in the next two weeks

In most industries, 87% or more of their businesses were currently trading and had been for more than the last two weeks. However, the accommodation and food service activities sector and the arts, entertainment and recreation sector had 44% of businesses in each industry reporting currently trading.

Of businesses who reported started trading within the last two weeks after a pause in trading, the accommodation and food service activities sector reported the largest percentage, at 33%. Of these businesses, 86% had a presence in England as relevant lockdown restrictions were significantly eased in England only on 4 July.

In the UK the next two largest percentages were reported by the arts, entertainment and recreation sector and the construction sector, at 12% and 8% respectively.

The arts, entertainment and recreation sector and the accommodation and food service activities sector also reported the largest percentages of businesses that indicated they had paused trading but were intending to restart in the next two weeks, at 14% and 9% respectively.

Conversely, the arts, entertainment and recreation sector and the accommodation and food service activities sector also reported the largest percentages of businesses indicating that they had paused trading but were not intending to restart in the next two weeks, at 29% and 13% respectively.

Increased turnover categories have been combined for presentational purposes, but the breakdown is available in the detailed dataset in Section 12.

Of businesses continuing to trade, the sector that had the highest percentage of their businesses reporting that their turnover increased was the wholesale and retail trade sector, at 22%. Recent June 2020 results for Retail sales showed a large boost in activity.

Of businesses continuing to trade, the industries with the highest percentages of their businesses reporting that their turnover decreased by more than 50% were the arts, entertainment and recreation sector and the accommodation and food service activities sector, at 43% and 42% respectively. None of the other industries reported more than 20% for this category.

The South West, the West Midlands and the North East were the regions that had the greatest proportion of businesses that saw a decrease in turnover, all with 62%. The West Midlands and the North East also had the lowest proportion of businesses with turnover unaffected, both at 20%.

In contrast, Northern Ireland saw the lowest proportion of businesses with a decrease in turnover with 54% and the highest proportion of businesses with turnover unaffected, at 30%. However, this may be as a result of low response from businesses with a presence in Northern Ireland at just 14%, compared with the UK response rate of 24%.

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.

Of businesses who had not permanently stopped trading, 19% 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 64% and 45% respectively.

Across all industries the remainder of the workforce were either working remotely (39%) or at their normal place of work (38%). The information and communication sector had the highest proportion of their workforce working remotely, at 76%, followed by the professional, scientific and technical activities sector and the education sector, at 74% and 73% respectively. The human health and social work activities sector (private sector businesses only) reported the highest proportion of their workforce working at their normal place of work, at 73%.

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.

Within the accommodation and food service activities sector, the large proportion given to “Other” was because of reports of maternity leave and sickness not coronavirus-related.

When broken down by trading status, businesses continuing to trade reported 17% of their workforce had been furloughed under the CJRS, with this rising to 81% when looking at businesses who had temporarily closed or paused trading. Of those continuing to trade, the arts, entertainment and recreation sector had the highest proportion furloughed, at 47%, while of those businesses temporarily closed or paused trading, the information and communication sector reported the highest proportion of the workforce furloughed, at 93%.

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 64% in the arts, entertainment and recreation sector.

Of businesses continuing to trade, 7% of the workforce had returned from furlough in the last two weeks, while 4% had returned from remote working to the normal workplace. The accommodation and food service activities sector reported the highest proportion of the workforce returning from furlough leave, at 18%, followed by the arts, entertainment and recreation sector and the construction sector, both at 15%. The administrative and support service activities sector reported the highest proportion of the workforce returning to their normal place of work, at 6%.

Of businesses topping up their furloughed workers’ pay (apportioned by workforce size), 67% of the workforce had their pay topped up. Those businesses within the human health and social work activities sector (private sector businesses only) and the education sector reported the largest proportion of the furloughed workforce receiving top-ups, both at 95%.

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 12.

Figure 7: Of all responding businesses, social distancing, hygiene measures and personal protective equipment (PPE) were the top three most common safety measures

Safety measures, businesses who have not permanently stopped trading, broken down by industry, UK, 29 June to 12 July 2020

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

Notes:

1. Final results, Wave 9 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 of rounding, percentages less than 1% being removed for disclosure purposes, businesses could select multiple options and other safety measures have been removed from the chart for presentational purposes – further detail can be found in the detailed dataset in Section 12.
3. Other services and Mining and quarrying have been removed for disclosure purposes, but their totals are included in “All industries”.

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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 90%, 84% and 80% respectively.

Across all industries, 72% 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 12.

Of responding businesses continuing to trade and who had implemented one or more safety measures, 12% reported operating costs had substantially increased and 62% reported they had increased a little.

The accommodation and food service activities sector had the highest percentage of businesses who reported operating costs had increased significantly, at 41%, followed by the arts, entertainment and recreation sector and the human health and social work activities sector (private sector businesses only), at 28% and 26% respectively.

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

Figure 9: 79% of businesses who had not permanently stopped trading had applied for the Coronavirus Job Retention Scheme (CJRS), while 97% reported to have received the CJRS

Government schemes estimates from the Business Impact of Coronavirus Survey, 29 June to 12 July 2020, UK

Notes:

1. Final results, Wave 9 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 of rounding, percentages less than 1% being removed for disclosure purposes and businesses could select multiple schemes – further detail can be found in the detailed dataset in Section 12.
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 29 June to 12 July 2020. However, for questions regarding government schemes, businesses may respond from the point of completion of the questionnaire (13 July to 26 July 2020).

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The accommodation and food service activities sector and the transportation and storage sector reported the highest percentages of businesses applying for the Coronavirus Job Retention Scheme (CJRS), at 96% and 92% respectively.

All industries had 95% or more of their businesses reporting they had received the CJRS. Across all industries, the average percentage of those receiving the CJRS was 97%.

The human health and social work activities sector (private sector businesses only) and the information and communication sector reported the highest percentages of businesses not applied for any of these schemes, at 56% and 45% respectively.

In Scotland, 83% of businesses had applied for the CJRS, compared with 81% in Wales, 79% in England and 78% in Northern Ireland.

There was some variation between the regions, with 98% of businesses receiving funds in Scotland, compared with 97% in England and 95% in both Wales and Northern Ireland.

In Scotland and Wales, 14% of businesses had not applied for any of these schemes, compared with 17% in Northern Ireland and 19% in England.

The accommodation and food service activities sector was the industry that had the highest percentage of businesses using the business rates holiday (76%), deferring Value Added Tax (VAT) payments (77%) and HM Revenue and Customs (HMRC) Time To Pay scheme (29%) initiatives.

Further breakdown by industry of government schemes and initiatives can be found in the detailed dataset in Section 12.

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 between zero and six months have been combined for presentational purposes, but the breakdown is available in the detailed dataset found in Section 12.

The water supply, sewerage, waste management and remediation activities sector and the accommodation and food service activities sector had the highest percentages of businesses indicating they had no cash reserves, at 9% and 8% respectively.

The accommodation and food service activities sector also had the highest percentage of businesses indicating they only had cash reserves to last between zero and six months, at 55%, followed by the arts, entertainment and recreation sector and the construction sector, at 52% each.

Conversely, the information and communication sector and the education sector reported the highest percentage of businesses indicating they had cash reserves to last more than six months, both at 49%.

Businesses continuing to trade were asked in Wave 9 how their stock levels had been affected by the coronavirus (COVID-19) pandemic in the last two weeks.

Of businesses continuing to trade, 11% reported that stock levels were higher than normal. The manufacturing sector and the wholesale and retail trade sector had the highest percentages of businesses reporting this, at 21% and 19% respectively.

The accommodation and food service activities sector had the highest percentage of businesses reporting stock levels were lower than normal, at 50%. Across all industries, 17% reported that stock levels were lower than normal.

Additionally, 36% of all businesses continuing to trade reported that stock levels had not changed.

Businesses continuing to trade were also asked how the coronavirus pandemic had affected their capital expenditure.

Of businesses continuing to trade, 15% reported that capital expenditure had stopped. The accommodation and food service activities sector and the arts, entertainment and recreation sector had the highest percentages of businesses reporting this, at 30% and 29% respectively.

Additionally, 23% reported that capital expenditure had been lower than normal. The education sector was the industry with the highest percentage of businesses reporting this, at 39%.

In contrast, the human health and social work activities sector (private sector businesses only) had the highest percentage of businesses reporting that capital expenditure was higher than normal, at 17%. Across all industries, 6% of businesses continuing to trade reported that capital expenditure had been higher than normal.

For Wave 9, 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, 17% reported there had been more innovation while 6% reported there had been less. An additional 35% reported that innovation had not been affected.

For Wave 9, businesses who had not permanently stopped trading were asked how they had handled the postponing or cancelling of bookings, services and events.

The arts, entertainment and recreation sector and the education sector had the highest percentages of businesses reporting they had postponed or cancelled bookings, services and events, at 84% and 74% respectively.

The three most common management approaches that responding businesses who have not permanently stopped trading indicated they were using when bookings, services and events were postponed or cancelled were: rescheduling for a future date, offering the option to re-book for future dates, and offering full refunds, at 62%, 50% and 38% respectively.

Further details of additional management approaches used for postponed or cancelled bookings, services and events are available in the detailed dataset in Section 12.

Feedback

As a user of the Business Impact of Coronavirus (COVID-19) Survey (BICS) data, we would like to hear your thoughts on the future of the survey. If you would like to provide your views, please complete this short questionnaire to help shape the future of BICS. The survey will remain open until 21 August 2020.

Sample and response rates

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 9 data relate to the period 29 June to 12 July 2020. The survey questions are available in Business Impact of Coronavirus (COVID-19) Survey questions: 29 June to 12 July 2020.

There were several additional questions in Wave 9 that were new to the BICS from previous waves. These included detailed questions on capital expenditure and postponed or cancelled bookings, services and events.

The different experiences of businesses during COVID-19

In the final results of Wave 9, of 24,493 businesses surveyed, 5,851 businesses (23.9%) responded. The Wave 9 survey was live for the period 13 July to 26 July 2020 and businesses were asked about their experience for the two-week survey reference period 29 June to 12 July 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: 29 June to 12 July 2020 and 13 July to 26 July 2020. More detail on the type of questions asked are available in the detailed dataset in Section 12.

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 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.

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 9 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 24,493 businesses with a split of 7,291 in employment for 250 and over and 17,202 for employment between 0 and 249. This breaks down further for 14,505 for employment between 0 and 99, and 2,697 for employment between 100 and 249.

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 article 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') latest indicators release in the alternate weeks.