OBR Forecast and Welsh Government Tourism Barometer (Coronavirus (COVID-19) impact survey): wave 2 2020
Firstly, the Chancellor recently made reference to the latest OBR report during the Government’s Coronavirus update. The headline figures are extremely shocking with the prospect of a 35% fall in GDP during Q2 and unemployment rising to 10%! A scenario that is modelled on a three month lock-down period followed by three months of social distancing restrictions, which suggests that this maybe the base scenario that the Government has asked them consider. If this is correct then lock-down would end around mid-June and restrictions would end mid-Sept. A link to the OBR reports - https://obr.uk/publications/
Secondly, the Welsh Government's recent Tourism Barometer Impact Survey where Visit Wales conducted a telephone survey between 26 and 31 March with 402 tourism businesses covering, accommodation; attractions; activity providers and restaurants & pubs which was conducted about a week after the Prime Minister first asked the public to stay at home, therefore as two weeks is a long time during a crises, we suspect that these early results may have shifted further. However they give an insight into the early impact on our businesses.
Half of businesses are reported to have asked staff to take paid leave, paying staff and relying on the promised finance for furloughed staff for reimbursement. This is where it is extremely important that money is received quickly to reimburse businesses and maintain a stable cash-flow. A third of businesses have had to ask staff to take unpaid leave, with 4% making staff redundant. Despite this, only 25% believe they are eligible for wage grant support, whilst a further 59% are unsure as to whether they will receive grant or were not even aware they maybe eligible. One of the reasons given for the confusion is that they do not know if or how the support in Wales differs from England. Hopefully, much of this confusion has been cleared up over the intervening weeks?
The report finalises with a not unsurprising conclusion 'nearly all (96%) businesses expect the future impact of the outbreak to be ‘significantly negative’. The stress this is causing business owners cannot be understated, as they struggle to find ways of surviving financially during a period which currently has no clear end. The only positive that some businesses are hoping for is a bounce in domestic tourism when the crisis is finally over'. Link to full report: