Coronavirus: Businesses forecast ‘substantial’ revenue hit as three in ten consider job cuts

More than half of the UK’s large and medium-sized businesses are expecting to endure a “substantial” revenue drop as a result of the coronavirus outbreak, new data suggests.

Almost half of UK businesses felt Chancellor Rishi Sunak's support measures were not enough to help business weather the coronavirus crisis

A poll commissioned by private equity provider Leonne International found that 55 per cent of larger companies now forecast a significant turnover hit due to the Covid-19 crisis.

The survey of 200 senior business decision-makers across the UK, conducted after the Chancellor’s announcement of a £330 billion package to help businesses cope with the unprecedented outbreak, found an almost even split in larger companies’ opinions of the government response.

Just over half (52 per cent) agreed that the government was doing enough to support companies during the crisis, while 48 per cent disagreed.

Additionally, 28 per cent said they were actively planning to make redundancies to survive the crisis, while 56 per cent of business chiefs predicted an economic crash “worse than 2008”.

Four in ten business polled forecast a major house price crash this year, as a knock-on effect of the outbreak.

Michael Haston, chief executive of Leonne International, said: “It’s clear that the Chancellor’s swift and decisive action has provided much-needed support to business leaders, despite the huge disruption caused by Covid-19.

“With millions of jobs at stake and tens of thousands of businesses seeing a sharp decline in revenue, it’s essential that the government stands squarely behind British businesses to help them through this crisis.

“However, there needs to be a much more concerted effort within the wider business community to help companies get access to the financial and support they need to avoid lay-offs.”

Regarding support for businesses, 47 per cent of respondents said there should be more collaboration between the global business community to devise a plan of action to address the implications of the outbreak and 43 per cent said that banks should offer businesses “zero-interest” loans.

Additionally, 24 per cent said that their bank was reluctant to provide the necessary short-term financial support to tackle the crisis.

Haston added: “It’s critical that banks and financial services providers do everything in their power to help companies get access to the credit they need.”

The study comes on the same day as research from Big Four accounting giant KPMG forecast that, if the Covid-19 pandemic is contained by the summer, UK gross domestic product will decline by 2.6 per cent for 2020 and enjoy a “sharp recovery” in the first half of 2021 as uncertainty dissipates.

A more enduring outbreak could prompt a fall of 5.4 per cent this year, said KPMG.

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