Has Lockdown Slowed Business in the UK?

21st October 2020

The last few months have been some of the toughest in living memory, whether you’re 6, 16 or 66. Since the term “coronavirus” was first used we’ve all been living in some form of fear relating to health, our careers, our finances and what it all means for the future. It’s undoubtedly been a scary, unsettling time and there have been millions around the world who have sadly lost their lives because of this virus that doesn’t discriminate against male or female, young or old.

When the UK was first put under lockdown in March 2020 lives began to change forever. The moment that the Prime Minister gave the order to stay at home and save lives was the moment that will be referred to in history textbooks in the future when children are taught about this pandemic; and all because it had such an impact on our personal and professional lives.

While our personal lives continue to adapt to the “new normal” with social distancing regulations and face coverings to be worn; businesses aren’t able to adapt in the same ways. The virus has already taken its toll on hundreds of companies in the UK alone across a wide range of sectors with the hospitality industry undoubtedly taking the brunt of the impact with pubs, bars, cafes and restaurants forced to close their doors back in March never to open again.

Even today, seven months on as we write this post, there are breaking news stories of more bars and restaurants making the tough decision to close for good rather than continuing to pay the wages of staff that they just can’t financially justify given social distancing measures reducing the capacity and the reluctance of many to venture into town and city centres to socialise as a household.

Searching for light in the dark

The last few months, as we’ve already mentioned, have been the hardest many people’s living memories with only those who lived through the Great Wars knowing such hardship, pain and suffering.

However, there have been some signs of light in the darkness in the form of some of the sectors that have either thrived throughout the lockdown process or evolved to such an extent that they have completely repurposed themselves and found a whole new lease of life, or even a completely new purpose.

You only have to look at some of the factories that came to the rescue of the NHS during the peak of the pandemic and lockdown periods. Rather than closing their doors because of the decline in need for the latest fashion, they adapted their strategies to provide much-needed PPE for our frontline workers in the form of gowns, masks and visors. Not only did these strategies keep our nurses and doctors safe, they also helped to preserve the jobs of staff in the factories and even taught them new skills that have, in some ways, helped to preserve the future of that business, too.

The data makes for positive reading

On the back of that feel good story, it’s also really positive to see some of the sectors that have seen signs of growth throughout the lockdown period, and continued that since restrictions were lifted. By the middle of September we had seen £5.5bn worth of government tenders made available, which is up by 17 per cent from the start of lockdown in March.

Business growth stories are often talked about in passing, but after such a dark period and a time when so many have lost their jobs due to the effects of Covid-19 and the subsequent restrictions on sectors such as hospitality, it’s certainly worth celebrating the amount of new business opportunities created during lockdown.

From the time of lockdown until 15th September there were a total of 369,885 new companies incorporated, which was up by 13.6 per cent on the same period in 2019 when there were 325,562. Now, there are two ways of looking at this particular statistic. One is that there have been a lot of people made redundant and they have set up on their own after years of contemplation, or a second way of looking at it is that people who have been made redundant have been faced with a number of opportunities to find alternative work with the new companies around them searching for staff and the potential to go into business with a friend, family member or former colleague based on the redundancy package they may have received.

Early in the lockdown period we were featured in local and online media because of our own growth, and produced this infographic that showed some of the great opportunities available and some of the sectors that had shown signs of growth.

Meet Hugo lockdown business infographic

The UK has always been synonymous with entrepreneurship and keeping a stiff upper lip, fighting back against adversity to overcome challenges and the lockdown period has proved that we still have that same fighting spirit.

While lockdown may have been difficult for a lot of people throughout the UK, and the after-effects of Covid-19 may still be felt for years to come, it’s positive to look into the statistics more deeply than the terrible stories about the number of infections, deaths and people made unemployed. There were 695,000 people who were removed from company payrolls during the lockdown period alone, and more are set to follow before we reach Christmas and even the anniversary of going into lockdown; but if we were to instead look at the number of people and businesses who have thrived during this time and shown signs of significant growth then there are genuine signs of light and positivity for us to cling to.

Showing support for new and small businesses

These statistics also show that there are now more small businesses facing tough times, and that they need our support. While multi-national corporations and national chains have faced their own real challenges, it’s the independent businesses in our villages and towns that are staring at an uncertain future.

Among the 369,885 new companies incorporated since the start of lockdown are countless shops, cafes and restaurants opened and managed by individuals, couples and families. They have gone into the industry safe in the knowledge that they are facing an uphill battle to get their business off the ground and to stay afloat; but initiatives over the last few months have given them a glimmer of hope that they can withstand the tough Covid-19 times and come out on the other side with successful businesses.

People have been encouraged to ditch their trips to the larger chains and instead to shop, eat or drink at the local independent locations that need their help. As a result suburbs and towns have seen boosts in business and many of the smaller, new businesses are reaping the benefits and seeing new customers approach them for takeaway meals, cups of coffee in their quaint gardens and verandas and products sold to customers who might otherwise have shopped online or in the city centre shopping centres.

The Eat Out to Help Out scheme launched in August encouraged people to eat out at local restaurants on a Monday, Tuesday or a Wednesday and this enabled the hospitality industry to start showing signs of recovery. The pubs, bars, restaurants and cafes that benefited from the scheme were able to keep staff on the payroll, boosted by the sudden income that came on traditionally quieter days of the week and brought people through the doors who may never have previously – or ordinarily – paid them a visit and, now, they visit on a regular basis for a drink or bite to eat.

So has business in the UK slowed during lockdown?

Business in the UK has undoubtedly had its confidence dented by Covid-19 and the various different lockdown periods and tiers we’ve faced since March 2020, but at least we can see clear signs of growth and opportunity.

It’s true that while there have been so many success stories over the lockdown period there have also been plenty of companies who have unfortunately closed their doors never to reopen. The lockdown period forced many to shop online through sites such as Amazon for their essentials, rather than visiting the local high street as they were encouraged to stay home during the peak of the pandemic, but post-lockdown we’ve seen plenty of signs of growth that suggest that lockdown may have slowed business temporarily, but has now allowed it to pick up speed and make progress.

The ability to work from home has meant that companies can continue operating, and the government furlough scheme allowed them to take the time to re-evaluate their strategies and implement new campaign plans based on revised budgets and practicalities.

Previously companies were reluctant to allow staff to work from home because of fears over drops in productivity, yet the current encouragement to work from home – and the initial findings from the first work from home period during lockdown – but realising that productivity levels remained high and staff were just as motivated, meant that they could continue offering the best of their products and services (and revised approaches as mentioned previously with the new PPE) and carry on functioning as a business with minimal redundancies.

As we stand here now in the middle of October, faced with yet more ongoing uncertainty over lockdown restrictions and business survival, we are in a much greater position than many business “experts” predicted, and we are seeing independent stores, restaurants and cafes benefitting from schemes such as Eat Out to Help Out and people’s willingness to support local business. Not only that, companies who have invested wisely over the years and done all they can to keep staff – and customers – are now reaping the rewards for their hard work and endeavour as they now start to blossom.

You can grow your business, too

Business growth opportunities are everywhere, but the biggest stumbling block for many is having the time and ability to go out there and find it. Many can rely on social media or word of mouth, but others need to get a foot in the door and pitch for new projects.

If that’s you then Meet Hugo is here to help. Our sales intelligence platform takes the legwork out of the new business process by sourcing opportunities in your sector and according to your budget and other key criteria, then delivers them to you with all you need to pitch for that piece of business.

If you’d like to find out more about our platform you can speak to sales who will provide you with a free demo, or you can sign up here for a quarterly or annual subscription.

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