SMEs worried about making it through the pandemic
A quarter (23%) of SMEs think it is unlikely they will be in business beyond the end of this year as a result of the coronavirus pandemic.
Since tightened restrictions came into force in November 2020, a significant majority (85%) of SMEs had to make operational changes that included letting staff go or furloughing them, according to research by employee benefits platform WorkLife by OpenMoney.
Worryingly, one in 10 (10%) were forced to shut down completely and are still unsure when they’ll be able to open their doors again.
Steve Bee, director of employee benefits provider WorkLife by OpenMoney, told HR magazine given how vital workers will be to many businesses’ recovery, HR teams need to ensure they are well-equipped to manage the long-term effects of the pandemic.
He said: "This makes an employee wellbeing strategy even more key, and any strategy will need to cover the three key pillars of wellbeing – financial, mental and physical.
"Even if you already have a plan covering these areas, taking the time to reassess your workers’ future needs and priorities is essential, as it’s more than likely you’ll find certain resources could be better utilised moving forward."
Three-fifths (61%) of SMEs surveyed don’t think they can stay afloat without securing additional funding over the next six months.
Just over three-quarters (77%) of firms are still dependent on government financial support schemes, the most popular being business rates relief (27%) and the job retention scheme (27%).
However, many businesses are reportedly feeling more positive about the coming 12 months compared to this time last year.
While 45% of firms expect income to remain subdued, nearly a third (31%) expect this to increase.
Those in the retail, arts and hospitality sectors were most hopeful of an uplift, and on average, 72% SMEs expect income to return to pre-pandemic levels within the year.
Bee said while the government’s roadmap out of lockdown offered hope to many businesses, some still face an extremely uncertain future.
He said: “Despite the immense challenges however, UK SMEs have continued to adapt and embody the entrepreneurial spirit our country is famous for.
“It’s great to see so many feeling confident that their income will start levelling out over the next few months.”
Bee said regardless of a businesses’ specific situation, it is important they begin to take steps to strengthen their long-term health.
He said: “Given how vital workers will be to recovery, the key to this will be ensuring they are equipped to manage the long-term effects of the pandemic, including addressing issues linked to personal finances or mental health.”
Business support available during the pandemic: