New survey shows ‘eye-watering’ effect of coronavirus on Suffolk’s economy
- Credit: Sarah Lucy Brown
An “eye-watering” new survey has shown the unprecedented impact of Covid-19 on Suffolk’s economy – but the first signs of recovery are also starting to show.
Suffolk Chamber of Commerce’s Quarterly Economic Survey polled 159 businesses around the county and found that, by almost every measure, businesses were worse off now than they were in the first quarter of the year.
Between the start of April and the end of June domestic sales for manufacturing businesses fell by 70% and 79% for service businesses. Overseas sales fell by 42% for manufacturers and 49% for service providers.
This impacted on businesses cash flow. The number of firms reporting they were in the black fell by 45% in the manufacturing sector and by 63% for service firms. It also meant that businesses were less able to take on more staff.
Paul Simon, Suffolk Chamber’s head of communications & campaigns, said: “These are eye-watering figures, but not unexpected given the enormous impact of the lockdown on business activity. Having handled 2000-plus queries from companies over the last three months or so, Suffolk Chamber has an unique insight into the challenges, prospects and hopes of the county’s business community as we enter the recovery period.
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“As well as many tales of real hardship, we have also encountered many examples of determination, innovation and resilience.”
Matt Moss, managing director of Smart, a Thurston-based garden offices company, said: “I think it will definitely be a year of two halves.
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“I think the books for the first half are going to look pretty hideous. If we end up breaking even this year I think that will be an excellent result.”
During the coronavirus lockdown, the firm furloughed all but one of its 40 staff. Since July 1, all but two of their staff are back off furlough after a phased reopening of the business.
Mr Moss estimates his company lost around £800,000 during the lockdown, but enjoyed its best ever month in June.
“The bit in between was the challenge, because there was a huge amount of supply chain management that I had to do.
“When we shut down I basically refused to take any customers money because I couldn’t commit to when I would complete anybody’s job. So that literally froze our income stream overnight.”
Mr Moss says the companies success since lockdown is due to the boom in people working from home.
But for other companies Mr Simon says the way to improve growth coming out of lockdown is through investment. He said: “Business confidence is the key to recovery, both in the short and long terms. Government has an important role to play in boosting how quickly businesses feel they can start investing in new staff and equipment. The recent infrastructure promises made by the Government this week are a good start. We believe a vital project that should be immediately delivered is the upgrade of the A14 in Suffolk.
“Linking the Port of Felixstowe to the Northern Powerhouse and the Midlands Engine, the A14 in Suffolk is the equivalent of a country track – and not fit for the UK’s free trade future.
“This spending must be brought forward now.”