A new survey from accountancy firm BDO reveals 70% of North West businesses see a resurgence of the COVID-19 epidemic as the main threat to the economy. Tony McDonough reports
Businesses in Merseyside and across the North West say a second wave of COVID-19 is a bigger threat to the economy than a no-deal Brexit.
A new survey from accountancy firm BDO reveals 70% of North West businesses see a resurgence of the coronavirus epidemic as the main threat to the economy. It also shows 83% of North West businesses think the Government will make progress on its ambition to ‘level up’ the UK regions.
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BDO’s monthly Rethinking the Economy survey of 500 mid-sized businesses show clearly that the COVID-19 pandemic has replaced Brexit as the main worry of the majority of firms in the region. This despite the deadline for the UK to exit the EU looming on December 31.
Ed Dwan, partner and head of BDO in the North West, said: “The COVID-19 pandemic clearly presents an ongoing threat to North West businesses, as they continue to contend with tightening Government restrictions and the reintroduction of local lockdowns in many of the region’s boroughs.
“With very little detail on what a potential Brexit deal could look like – and how comprehensive and far-reaching it might be – it’s clear that North West businesses have placed Brexit further down on the agenda.
“However, with the clock ticking, it’s essential that companies prepare themselves for life outside of the EU, addressing key areas such as supply chains, workforce, VAT registrations, processes and cashflow.”
Despite the Mayors of Liverpool City Region and Greater Manchester, Steve Rotheram and Andy Burnham, warning the North’s economy could become ‘levelled down’ if it doesn’t receive support over the winter, the BDO report also revealed that 83% of North West businesses think the Government will make progress in levelling up the regions in the next three years.
Mr Burnham said there was an “increasing sense of unfairness” in the way local restrictions have been applied. Combined with reports that the Government’s white paper on devolution and local recovery has been delayed until 2021, the Metro Mayor believes if the North faces a winter of restrictions without support it is clear that the region’s economy will be ‘levelled down not levelled up’.
Mr Dwan added: “While North West companies cope with a myriad of political and socio-economic challenge, the wellbeing and safety of employees and adapting for Brexit, what is encouraging is that more than a third of businesses still expect to expand their workforce in the next fiscal year, indicating recovery as they rebuild workforces.
“However, many plan to revise terms for employees. Our poll found that 30% of businesses have already altered their terms of employment for more than 10% of respective staff, including job shares and reduced hours.”