The negative impact from Covid-19 on London’s economy remains all too clear, but fresh figures show a slight improvement in business conditions during Q3 2020.
Whilst the majority of businesses reported downturns in most of the indicators, the number of companies reporting an increase in domestic sales and export orders rose. More companies also reported improvements in their cashflow and their economic prospects for the next year.
The results come from London Chamber of Commerce & Industry’s Capital 500 survey with Savanta ComRes – based on the quarterly performance of 503 businesses of varying sizes, sectors and across all London boroughs.
- The number of businesses reporting an increase in domestic sales rose slightly to 9% from 5% in Q2. 59% reported sales as being down during the quarter (a slight improvement on the 66% in Q2).
- 8% of companies reported export sales as up, the same as in Q2. But one in 10 business reported an increase in export orders (10%) – an increase on the 4% that said so in Q2.
NOW READ: Shop local in the run-up to Christmas to support struggling local companies
- One in five (20%) companies said that they expected their economic prospects to improve over the next year (16% in Q2). 45% said company prospects would worsen (a lower proportion that the 53% that said so in Q2).
- One in ten (11%) London businesses tried to recruit during the last three months (10% during Q2).
- One in ten (10%) reported that cashflow was up during the quarter (similar to the 7% in Q2). 60% of businesses said their cashflow had declined (65% in Q2).
Reacting to the results, London Chamber of Commerce & Industry Chief Executive Richard Burge, said: “There’s no getting away from the fact that Q3 2020 was bleak for many London businesses. But there are signs of early stage recovery for some businesses as the capital came out of lockdown.
“The challenge now is for London to manage Covid-19 transmission in a way that doesn’t curtail any recovery. Of course, health must come first and businesses are fully aware of that fact, which is why so many have invested in ensuring their workplaces meet Covid-secure guidelines. Many also have maintained home working, whether full-time or as a part-time hybrid with office working.
“As we head into the final quarter of what has been a largely unprecedented year for business for all the wrong reasons, companies need any further Covid-19 measures introduced by the Government to be evidence-based in terms of where transmission occurs. Otherwise, any signs of recovery will quickly reverse.”
For the latest headlines from the City of London and beyond, follow City Matters on Twitter, Instagram and LinkedIn.