- 17% OF ALL FIRMS DON’T KNOW WHEN THEY’LL BE ABLE TO RE-OPEN THEIR DOORS
- RETAIL AND HOSPITALITY WORST HIT; NEARLY 1 IN 4 FIRMS UNSURE WHEN THEY’LL RE-OPEN
Nearly a quarter of small retailers and hospitality firms don’t know when they’ll open their doors again after being forced to shut down because of the coronavirus pandemic and lockdown, according to new research carried out among the UK’s once thriving small business sector.
Nationally, a total of 35% of all SMEs said they had been forced to shut down during the Covid-19 crisis. While 18% said they were planning to reopen, 17% admitted they were unsure when they would be able to get back to work. The figure was fairly consistent across most industry sectors, but the retail and hospitality sectors were worst hit, with 24% saying they didn’t know when they would be up and running again.
The UK’s small businesses have been badly hit by the impact of Covid-19 in terms of both income and working practices, which could take years to recover from, according to the first Small Business Monitor from WorkLife, the new employee benefits service from online money manager OpenMoney.
Almost three quarters (73%) of firms saw their income reduce during the pandemic, with 46% reporting that it had fallen by up to 50%. Perhaps more worrying is the fact that 62% of SMEs expect their income to remain subdued over the next 12 months, with 42% saying it will be reduced by up to 50%. A small but significant 5% of firms don’t expect to recover any income at all over the coming year, putting their futures in doubt.
With Britain’s small business sector employing more than 16.5 million people1, this will also have a devastating effect on the country’s workforce, many of whom are already struggling financially themselves. Almost three million2 cash-strapped people have been given payment holidays on their mortgages and credit cards.
Rob Marshall, managing director of WorkLife, believes that companies and employees need help to get back on their feet. He says: “We’ve all seen our high streets devastated during lockdown with shuttered shops, pubs and restaurants. The likelihood is that many won’t reopen.
“But for those that can reopen, as our Small Business Monitor shows, the worst is far from over. Income has reduced, while the changes needed to operate under social distancing rules are likely to push up their costs even further. This is a massive strain on everybody working there.”
To support both small firms and their workers, WorkLife is offering its newly launched employee benefits service at no cost to companies for the rest of the year*. One of the key elements of WorkLife is a free financial advice service for all employees, provided by OpenMoney. WorkLife also gives workers free mental wellbeing support, plus a host of discounts on shopping, restaurants and fitness retailers that will add up to hundreds of pounds worth of savings every year.
Marshall explains: “As our research shows, the current situation is bad news for bosses and terrible news for their employees, many of whom will already be worried about job security and their personal financial situation. But with WorkLife, there is a real opportunity for employers to provide their workers with the help they need during what is clearly going to be a difficult period of recovery and return to work. And it won’t cost companies a penny for the rest of 2020.”
In addition to free financial advice from OpenMoney, mental wellbeing guidance from Thrive, shopping and restaurant discounts from Purecard, and health and wellbeing deals via My Active Discounts, WorkLife also offers workers discounted rates on life and critical illness insurance from Anorak and household insurance from Uinsure.
The WorkLife platform is simple for employers to set up online, linking up with payroll information and workplace pensions, so employees can see all their benefits and salary in one place. Employers can even add their own benefits and rewards. It is also simple for staff to log on to the platform, via a smartphone, tablet or computer, so they can choose the benefits they want and keep track of their savings.
WorkLife’s Small Business Monitor is based on research carried out by 3Gem among 750 senior financial and HR decision makers in UK SME companies with 5 – 250 employees. Fieldwork took place 7 to 26 June 2020. The full report will be published next month.
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WorkLife is a digital platform on a mission to make financial advice and employee benefits accessible and affordable to every UK business.
Powered by OpenMoney, it combines top of the range financial advice and market leading benefits with low cost and transparent fees, allowing SMEs to reward their employees with the same great perks as those traditionally enjoyed by workers at larger companies. The platform puts an emphasis on employee wellbeing, making sure they are covered in all the financial, mental and physical aspects of their life.
To help those firms hit hardest by the coronavirus crisis, WorkLife will be offered free of charge to SMEs throughout 2020. *The normal cost is £2 per employee per month, with no additional setup fee.