Businesses in West are ‘adapting to crisis’
BUSINESS leaders say the first shoots of a potential economic recovery are appearing in the South West – even in the midst of Covid-19 lockdown.
Evidence cited includes the “seamless” working of further education colleges and universities, “innovative” changes in business model including by those in the rural economy, and the pace at which some firms that have for years dragged their feet on internet working have adopted change in the space of weeks.
Neither Tim Jones, who chairs the South West Business Council,
nor Kim Conchie, chief executive of Cornwall Chamber of Commerce, is downplaying the economic impact on a region hit particularly hard by the effects of coronavirus on tourism and hospitality, two key sectors.
“The impact is huge, but there are some green shoots, some good news,” said Mr Jones.
Mr Conchie agreed, saying that if the golden 10-week peak holiday season were lost the hit would be “devastating” but there were some signs that, in the long term, as more businesses took advantage of digital working the region’s quality of life would encourage more enterprises to locate or start up here.
In other developments, a South West expert in disease control backed the wearing of face masks in crowded locations. A further eight people infected with the coronavirus have died in the South West, three in Cornwall and five in Devon, taking the total in the two counties to 174. Nationally a further 823 people died in hospitals across the UK.
THE first shoots of a potential economic recovery are appearing in the South West, business leaders say.
Innovation and smart thinking have allowed some firms to switch direction and maintain cash flow, they report. Others have been able to cut their costs dramatically and keep some money flowing in.
Whole sectors such as further and higher education have been operating almost “seamlessly”.
The lockdown has speeded up trends such as remote and online working, potentially putting the region in a strong position to gain long-term because of the pulling power the quality of life in Devon and Cornwall, according to the leaders of two of the South West’s business organisations.
Neither Tim Jones, of the South West Business Council, nor Kim Conchie of Cornwall Chamber of Commerce, underplays the impact of the emergency on the two counties, but they say some encouraging signs are becoming clear.
“The impact of this on the region is huge,” said Mr Jones, who chairs the South West body. “In excess of 40% of workers in hospitality and retail are furloughed. But there are some green shoots, some good news.
“Some are well placed. Only about 4-8% of professional and businesses services are furloughed. Some in the rural economy have been quite inspirational and turned their businesses around with local deliveries: cheesemakers, salad and vegetable growers. Some of those changes will be long term.
“The FE colleges and universities have been able to operate online almost seamlessly, losing only about 5% of their student contact.
“Councils have moved very quickly and got on with infrastructure work that would normally have been very disruptive.”
Examples included the Forder Valley Link Road, a key new route in the north-east of Plymouth and drainage work on the A30 at Alphington junction leading in to the M5.
“They have really upped their game. This provides employment in the construction phase including orders for local suppliers, and gives us infrastructure improvements that help the economy.
“We have seen businesses that relied on supplies from outside the region and outside the country sourcing locally, which has opened up opportunities. We have seen an appreciation of the quality of the lifestyle in the South West.
“We have underplayed our capital assets, our moors, our seaside for too long. We could see a lot more new businesses coming into the region. We could be seeing those benefits in three to five years.”
Mr Conchie, chief executive of the Cornish body, said that he did not want to be “glib” or put a gloss on the situation. “More businesses in the hospitality sector and in tourism
could throw the towel in if they miss the 10 golden weeks of summer. That would be devastating. There are some retail businesses that can’t pivot,] quickly changing their model.
“But some can and have done. I spoke to a gallery owner who has furloughed staff and managed to keep 50% of her normal business at Easter.
“The growth in ‘localness’ is encouraging. Westcountry Fruit Sales has gone from a wholesale to a home delivery business, although probably with a fraction of their usual sales. We have seen change come in in weeks that was taking years. Suddenly driving three hours to Bristol for a meeting is ludicrous when it can be done on a video link.
“We are also seeing the benefits of the work-life balance in the South West. Businesses can have their development, their ‘brains’ here and their operations elsewhere. I can see that coming through in two years’ time perhaps,” said Mr Conchie.
“We need tax breaks for premises above shops to be converted into homes, bringing people into our town centres to help the economy and so we don’t have to build new ‘boxes’ on our green hills.”