Chamber survey highlights urgent need for support to reach businesses | April 2020

A survey carried out by Isle of Man Chamber of Commerce has highlighted the urgent need for Government support to reach businesses affected by the COVID-19 crisis.

Date: Wednesday 08 April 2020

A survey carried out by Isle of Man Chamber of Commerce has highlighted the urgent need for Government support to reach businesses affected by the COVID-19 crisis.

The Island’s biggest business network carried out the first in what will be a regular series of Covid-19 Business Impact Tracker surveys with more than 400 businesses (both Chamber and non-Chamber members) contributing to the inaugural poll. Unsurprisingly, the results paint a concerning picture for the local economy in light of the current situation.

Chamber President Caren Pegg said: “The coronavirus pandemic has already taken a heavy toll on our local economy. While Chamber welcomed the financial measures Isle of Man Government put in place, the findings of our first Impact Tracker survey highlight the urgent need for that support to reach businesses on the ground as soon as possible. It is clear that many businesses, particularly small organisations, cannot wait weeks or months for help to arrive. There’s no escaping the unprecedented scale of the challenge that all Isle of Man businesses are facing, and the focus not only needs to be on the immediate support required but also on a mid to long term plan for the economy.”

Most of the participating businesses in this first survey were small businesses (comprising less than ten employees) and businesses that operate in sectors that have been immediately impacted due to the restrictions put in place such as hospitality, construction and retail.

Headlines from the first survey (carried out from 1st to 7th April) include:

· Of most concern is the impact on cash flow, an important indicator of overall economic health. 90 per cent reported that their revenue has decreased since the crisis hit, while 40 per cent reported less than a month’s worth of cash in reserve, while 33 per cent reported only 1 to 3 months’ worth of cash in reserve. Only 6 per cent of respondents reported over 12 months’ worth of cash in reserve.

· Most participating businesses have experienced a sharp and significant fall in revenue,

· The majority of participating businesses (78 per cent) have three months’ cash in reserve or less.

Isle of Man Chamber of Commerce

· Following the government’s pledge to provide businesses with a flat rate contribution of £280 per week for every full-time equivalent staff member (and on a pro-rata basis for part time employees), 30 per cent of respondents said that they were planning to furlough between 90 to 100 per cent of their workforce over the next week.

· 26 per cent of businesses that took part in the survey reported that they are planning to reduce their workforce over the coming week.

· On the issue of business continuity, 42 per cent of respondents said they have had to close their business in the last week, and 14 per cent reported that they are considering closure. Many of those included in these results have had to close due to lockdown regulations including businesses in construction, tourism and hospitality, health and wellbeing, retail and tradespeople.

· Encouragingly, most businesses reported awareness of IOM Government’s support schemes to help mitigate the impact of coronavirus. However, the percentage of firms actively in receipt of this support was low but it is hoped that this figure will rise in the coming weeks following the government’s official launch of the MERA on 6th April and applications for the Wage Support Scheme being released after the Easter weekend.

Chamber CEO Rebecca George said: “We have designed the surveys to act as a barometer of business’ response to the government’s measures and changes to working practices over the next few months. We thank all of the businesses who took part in the first survey, and encourage all businesses on the Island to contribute to the next survey so that we continue to compile a detailed and accurate analysis of the impact of the crisis as it develops. In particular, we are keen to ascertain if these headline findings are representative of bigger organisations operating on the Island given that the majority of businesses that participated in the first survey were small organisations.”

Dashboard results can be viewed here