Lockdown restrictions tightened for northern regions – what does it mean for SMEs?
Health Secretary Matt Hancock last night announced that several regions in the north of England, including Greater Manchester, East Lancashire and parts of West Yorkshire, lockdown restrictions have been tightened; banning separate households from meeting each other at home.
The move comes as the areas experience a spike in COVID-19 cases.
This announcement will increase fears that a second wave of Coronavirus and subsequent lockdown could be on the way as cases in Europe and specifically Spain start to rise.
A recent survey of small businesses outlined fears of a second lockdown as the top concern for SMEs, with 47% citing this as their biggest concern, ahead of cashflow (44%) and debt (20%).
A report has also outlined the differing impacts the Coronavirus pandemic is set to have on different regions of the UK. The findings indicate that while London will be hardest hit initially, it will recover much faster than other regional cities such as Manchester and Bradford. New lockdown restrictions are likely to increase inequality, especially in the small business arena as London bounces back.
Since the start of lockdown SMEs have borrowed over £12billion in government-backed loans. This support network demonstrates the vital importance of this sector that employs over 16 million people in the UK and provides 52% of private sector turnover. Growth finance for this sector has been, since the financial crisis of 2008, hard to come by for many firms – leaving private finance and investment providers to pick up the pieces.
Luke Davis, CEO and Founder of SME investment firm IW Capital, commented on the announcement: “This period has been incredibly difficult for businesses up and down the country but it does seem to have impacted businesses in the regions harder than many in the capital. One of the key points in economic recovery in the next year or so is to allow every region of the UK to come roaring back with confidence and the right support in place.
“As private finance providers, we have a responsibility to try and bridge this gap. There are fantastic businesses in the North of England with a huge amount of growth potential that may be slipping through the net as lockdown measures ramp up.”