Skip to main content
BoF Logo

The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.

UK Businesses to Lean Heavily on Government Support

Almost half of British companies expect to furlough 50 percent or more of their workforce, according to a survey, meaning reliance on a government scheme that will pay up to 80 percent of employee wages.
Retail shopping | Source: Shutterstock
By
  • Reuters

LONDON, United Kingdom — Almost half of British companies expect to furlough 50 percent or more of their workforce, a survey by the British Chambers of Commerce showed on Thursday, underlining demand for government support as the world's fifth-largest economy grinds to a halt.

Britain promised hundreds of billions of pounds in support for businesses during an enforced lockdown of the population to help prevent the spread of coronavirus.

One part of that support package — a promise to pay 80 percent of employees' wages up to 2,500 pounds per month if they are temporarily laid off — is set to be heavily used according to a survey of over 600 businesses conducted between March 25 and 27.

The survey showed 44 percent expect to furlough at least half their workers within a week, and 32 percent expect to furlough between three-quarters and all their workforce.

ADVERTISEMENT

In a bid to prevent firms permanently laying off workers and slowing the subsequent economic recovery, finance minister Rishi Sunak said funding for the scheme was unlimited.

BCC Director General Adam Marshall said that while the scale of the support was welcome, it was urgent that the promised funds find their way to struggling companies quickly.

"The majority of firms cannot wait weeks or months for help to arrive," he said in a statement.

The BCC data showed just under a fifth of firms reported having less than a month's cash in reserve, and 44 percent said they had 1 to 3 months' cash set aside.

Government instructions for people to stay at home and only shop for essential items lasts until April 13, but the lockdown is widely expected to be extended as Britain tries to reduce transmission of the virus and prevent its health service becoming overwhelmed.

The BCC survey also showed nearly two-thirds of firms reported a significant fall in revenues from within Britain, as many non-essential sectors have been forced to shut down.

Responding to criticism that many of the announced support measures have yet to kick in, a spokesman for the finance ministry said on Wednesday that hundreds of loans made under a separate emergency scheme had already been made.

By William James; editor: Stephen Addison

© 2024 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions

More from Retail
Analysis and advice from the front lines of the retail transformation.

At Front Row, Accelerating New Routes to the Consumer

Formed of five different agencies with complementing areas of expertise, Front Row partners with beauty, health, wellness, and consumer brands to accelerate their e-commerce growth. Here, its chief brand officer, Christopher Skinner, shares the challenges and opportunities in reaching new consumers.


view more

Subscribe to the BoF Daily Digest

The essential daily round-up of fashion news, analysis, and breaking news alerts.

The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.
CONNECT WITH US ON
The Business of Beauty Global Forum
© 2024 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions, Privacy Policy, Cookie Policy and Accessibility Statement.
The Business of Beauty Global Forum