Businesses fear a winter ‘reckoning’ survey warns

A new survey by the Scottish Chambers of Commerce has found the vast majority of businesses are striving to retain staff.

Just 11 per cent of those polled have made staff redundant so far but confidence in avoiding redundancies starts to slump over the coming months – with tourism, hospitality and retail at risk, it found.

Currently, 60 per cent of businesses have employees on the furlough scheme, the snap poll carried out last month found. Some 74 per cent said they expected to retain staff over the next three months. Yet this falls to 68 per cent when the UK Treasury’s furlough scheme ends in October – signalling redundancies in winter. Businesses have also been stung by rising costs to make premises ‘Covid secure’ at the same time as facing reduced capacity and trade being down, the SCC said.

Despite the lifting of restrictions, ‘poor customer demand’ remains a key concern for 63 per cent, the survey found.

The most ‘significant concern’ is another national or a local lockdown – highlighted by eight in 10 firms.

Dr Liz Cameron, chief executive of the Scottish Chambers of Commerce, said: ‘We fear a reckoning as some companies, particularly in tourism, hospitality and retail decide it is no longer viable to restart or continue in the coming months.

‘For those sectors which remain closed or have just resumed operations, helping them back to work and restoring consumer confidence as quickly as possible is crucial.

‘Alongside a cautious outlook for employment, the tracker survey highlights there is a need for more action by government to cut further the upfront costs of doing business.

‘Scottish businesses have already demonstrated we are adaptive, innovative and resilient, but the challenges we face over the next few months, potentially years, warrants a response from government that is just as substantial.’