The third economic trends report of 2020 captures the sentiment of the Cork business community in the transition from the initial shock waves of the Covid-19 pandemic to a considerably altered business operating landscape across the region and country. In our latest economic trends, Cork Chamber reports on business experiences during July, August and September, and the outlook for the fourth and final quarter of 2020. The economic trends survey findings also report on the changes made to work practices as a result of Covid-19, the return to offices, and access to fibre broadband connectivity across the county.
Cork Chamber President, Paula Cogan announcing the results, commented, “Businesses across the county have been under immeasurable stress since the onset of the pandemic. While navigating what is completely uncharted territory, the latest trends reflect the growing concern of the business community as they seek-out a degree of certainty. For Q3 we report a dip in business confidence to 68% from 73% in Q2, not surprising in current circumstances and as it’s clear that we must weather this storm for some time yet, the continued support for the EWSS throughout 2021 is ever more fundamental now. Last week’s budget announcement of the Covid Restrictions Support Scheme (CRSS) for businesses was a critical one and a very practical step in supporting the re-emergence from this pandemic in as strong as position as possible.”
Ms Cogan added, “In Q3 we report that 51% of businesses experienced a decrease in turnover. For context, at the same time in 2019 this figure was 7%. This is an incredibly challenging time right across society, and while we welcome the Government’s ‘Plan for Living with Covid-19’, and the recent Budget 2021 business supports announcements, a sharp eye must be kept on the effectiveness of these supports as we navigate the levels of the plan. While we are fortunate to have a duality in our economic model, with our FDI businesses sustaining a less than expected impact to our GDP, but the essential role of our SME’s, and independent operators must remain central to the recovery and every effort to assure and support the crucial role of these businesses must be made.”
Ms. Cogan continued, “Undoubtedly the Covid-19 pandemic has initiated dramatic changes to how we work, with 21% of responding businesses reporting >90% of employees are now working from home. When asked on the expected return date to the office, and taking account that survey responses were gathered over the last two weeks of September and before the current public health guidance advise, 19% reported that employees were at that stage returning to the office with more returning in the coming 2-3 months, however 18% expected this return from January 2021 onwards. Though difficult to gauge the return to offices with much of the anticipated return now reversed, we can be certain that the pandemic has accelerated changes to way we work, with blended working likely being adopted as we report that 48% of businesses were initiating changes to work practices and organisational policy to formalise a Work From Home offering for employees on an ongoing basis. In supporting new models of work, it is more crucial than ever that the national broadband plan is expediated to meet this demand, though very crucially to increase the resilience of business operations to global shocks.”
Pat Horgan, Head of SME Banking with Ulster Bank added, “Reflecting the responses of Q1 and Q2, Covid-19 remains the number one threat to business growth, followed by changing consumer spending and reduced orders, and of course Brexit. These are unprecedented times for businesses, and it is through working together that we will all get through this. At Ulster Bank we are supporting our business customers every day, by working with them, listening to them, and lending to them, as we champion potential. We are very pleased to continue our support for the Cork Chamber Economic Trends Survey and the Cork business community.”
In concluding, Paula Cogan added, “In the Q3 trends report, we see an increase in businesses reporting as not confident in the Irish economy to 71%, from 52% in Q2. This is not surprising as we take account of the business impacts of adopting tighter restrictions when necessary in the months ahead and in line with the Governments ‘Plan for Living with Covid’. Though it is through working together that we will overcome this challenge. We must ensure that we do what we can now to ensure an improved fourth and final quarter for 2020.”