Up to one million firms are at risk of collapse should restrictive lockdown measures continue for a further three months, a major study has revealed.
The research, published by the Centre for Economics and Business Research (Cebr), also suggests that some 250,000 UK firms face collapse should the lockdown continue for just one more month.
The figures form part of the Opinium-Cebr Business Distress Tracker, a survey of 500 businesses across the country.
According to the report, one in 10 businesses say they are at “high risk” of entering insolvency as a result of the Covid-19 pandemic, while a further 51 per cent state there is at least a “small risk” that they will go insolvent amid the outbreak.
This equates to roughly 250,000 businesses closing if the lockdown were to continue until July, while 1 million would be forced to close their doors if the lockdown extended until September.
The barometer also asked business owners how quickly they could recover their business should lockdown restrictions be lifted. On average, respondents said they will need six months to return revenue and production to “pre-crisis levels”, but some businesses warned it could take up to a year.
The report also suggests that on average, businesses’ profits were down by some 29 per cent in the first 30 days of lockdown.
Commenting on the figures, James Endersby, Chief Executive at data tracker Opinium, said: “The damage inflicted on UK businesses by the pandemic and lockdown is colossal, and the figures make for very sombre reading. The business impact is felt in almost every region, every sector, across every business size and at almost every level of employment. It’s unavoidable.”
He added: “With more than a quarter of a million businesses fearing they won’t survive if trading conditions remain as they are for another month, and a million businesses unable to last for three more months of lockdown, the Government’s comprehensive plan to unlock and restart the economy is well-anticipated and desperately needed.”
For support rebuilding and restoring your business, please get in touch with our expert team today.