What does ‘Freedom Day’ mean for UK businesses?
Today is the day many have been looking for – almost all restrictions on the UK’s Covid-19 Roadmap have been lifted – and life for all is set to return to some semblance of pre-pandemic normality. Following today’s changes, Business Leader has delved into what it really means for companies across the country.
iStock has today released new research which shows that the UK public are divided on whether or not they want to see COVID safety measures reflected within media, advertising and business communications.
The research found that one third (33%) of Brits would like to see people wearing masks in visual communications. Whereas almost half of Brits wouldn’t mind and 27% are against seeing people wearing masks in media and branded visual communications. It’s a much clearer picture when thinking about images which show activities such as dining or socialising taking place outside, with the majority of people in the UK 91% saying this would be preferable.
Opinion is also more supportive of imagery which shows people practicing social distancing, with the majority (83%) saying it would be good to see this represented. But opinion flips when thinking about images that show life before the pandemic, with most (85%) in favour of seeing these types of images. The findings are largely consistent across generation and gender.
Jacqueline Bourke, Head of Creative Insights EMEA for iStock, commented: “Our Visual GPS research tells us that while people will be relieved to have restrictions lifting, many are still concerned about safety and social distancing and want to see that represented in visual communications. What that means for advertisers and businesses is that they need to carefully balance the present and future with a multi-layered visual strategy which is respectful and inclusive of all audiences.”
Freedom Day fears: Concerns and confusion for over half of SMEs
A new poll from small business insurance provider, Simply Business, reveals the mixed feelings Freedom Day is creating for SMEs and the self-employed. Over half (53%) of those polled believe social distancing restrictions are being lifted too soon and we risk another lockdown. The concern is so great that almost 1 in 3 (30%) small business owners will retain social distancing and reduced capacity within their businesses.
The government decision to recommend the continued use of face masks in crowded indoor spaces represents a shift towards a more cautious reopening where personal responsibility has an increasingly large role to play. Almost half (47%) of small business owners think the responsibility for a safe unlocking should be shared by businesses and individuals.
However, the lifting of restrictions is understandably leaving small business owners with a headache and a third (29%) think there should be clearer guidelines from government to help small businesses reopen safely.
This latest challenge comes after a previous 2021 study by Simply Business showed that Covid-19 will cost SMEs an estimated £126.6 billion in total – double what owners predicted it would cost them when asked a year ago. With six million SMEs in the UK – accounting for over 99% of all businesses, 33% of employment and 21% of all turnover – this £127 billion hole in the books of small businesses represents a huge blow to the economy.
Alan Thomas, UK CEO at Simply Business, comments: “No business, big or small, has been able to escape the impact of the Covid-19 pandemic. 16 months of restrictions, lockdowns, and uncertainty were always likely to take their toll. But the scale of the impact felt by the self-employed is abundantly clear from our latest research which shows Covid-19 will cost SMEs an estimated £126.6 billion – double what owners predicted it would cost them when asked a year ago.
“Small business owners’ hopes for Freedom Day are at risk of turning to fears, with over half of SMEs saying restrictions are being lifted too soon. Given the rising number of cases, it comes as no surprise that there are strong calls for clearer guidance on how to safely manage a full reopening of businesses. Small business owners need clear, consistent guidelines but the onus on personal responsibility breeds confusion. SMEs aren’t public health experts with the ability to gauge the threat of a disease.
“SMEs account for over 99% of all British businesses and contribute £2 trillion to our economy every year. They’ve been among the hardest hit by Covid-19 lockdowns and will prove central to our collective economic recovery. With one in 10 small business owners not confident in resuming trading after 19 July, it’s vital that we support small businesses through this latest – and possibly confusing – period of recovery from the pandemic.”
Freedom Day shouldn’t signal a mass return to workplaces
Ahead of the Government’s updates on restrictions following 19th July, Peter Cheese, chief executive of the CIPD, the professional body for HR and people development, said: “Freedom Day shouldn’t signal a mass return to workplaces, but it could signal the start of greater freedom and flexibility in how, when and where people work. It should be down to individual organisations, consulting with their people, to agree working arrangements after the end of restrictions.
“Regardless of any changes to official guidance from 19 July, employers should continue to ensure that they have the necessary measures in place to give confidence to workers that their workplace is safe. This can include changes to desk spaces, shift patterns to help workers avoid busy times on public transport and use of one-way systems to reduce staff contact while the risk of infection remains. This will be particularly important in these early weeks while the vaccination programme is still ongoing.
“Businesses shouldn’t rush to simply revert to how they used to work now we have experience and evidence that it can be done differently, and with positive impacts on employee health and wellbeing, inclusion and productivity.
“People generally want a mix of workplace and home working, and the possibility of more choice in their working routines, meaning hybrid working can provide an effective balance for many workers. Employers should be trying to understand and support individuals’ preferences over more flexible working arrangements where possible, balanced with meeting the needs of the business.
“However, not everyone can work from home. Organisations should also look at increasing flexible options working for those who can’t work from home using different types of flexible hours arrangements. This will help avoid the creation of a two-tier workforce where home and hybrid workers have considerable flexibility while many other employees have very little.”
The return to the office: Is it the right decision?
Helena Nimmo, CIO, Endava said: “We’ve seen digital acceleration in the workplace like never before over the last year and a half, and despite Government restrictions in England lifting on 19th July, it’s fair to say that traditional office life is now a thing of the past.
“Where and how we work in the ‘new normal’ is likely to be more of an individual choice. The employee experience can now be defined by our lives outside of work as much as our commitments to employers. Businesses cannot take a one-size-fits-all approach given there are a myriad of different aspects at play in terms of where employees are in their lives and careers, and how safe they feel returning to offices.
“Workers have proven that it is possible to work effectively remotely and employers who continue to provide this flexibility will be better placed to attract and retain talent. Ensuring an organisation is properly setup for hybrid working, that combines home and remote working, will be critical in offering employees choice.
“Businesses can use technology to address the true complexities of working from anywhere in line with these new employee expectations. Challenges like safeguarding your business, when compliance traditionally assumes working from an office, while also maintaining the balance of user experience and security for both employees and customers, are far greater than most think.
“Questions around digital connectivity and the ramifications of security remain too as people opt to work from coffee shops, co-working spaces, and non-secure networks. After all, many compliance certifications were developed with the assumption that the majority – or indeed all – individuals were working inside an office-space. Practices must change to ensure regulatory compliance. Ultimately, each company will establish their own policies, but the expectation is that the future will be hybrid, representing a huge working culture shift.”
Impact on investors
- Investor confidence in the UK falls by 5% in July.
- Investor confidence falls by 2% on average for global regions.
- 65% of investors believe interest rates will rise in a year’s time, compared to 60% in June.
- 26% of investors believe interest rates will rise in 6 months, compared to 24% in June.
Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown expands on the data.
Far from bringing an added dose of confidence to investors, ‘Freedom Day’ appears to be a setback. Investors’ confidence in the UK has dropped by 5% in July, when compared to June, a steeper fall than the 2% registered on average for regions around the globe.
The sharply rising Covid infection rates across the country, and concerns about fresh easing of restrictions, is likely to be behind the drop, which is identified in the HL monthly investor confidence survey*.
Worries are mounting about what the lifting of social distancing rules will mean for economic recovery, if the virus spreads more rapidly. Already many industries from hospitality to manufacturing are struggling to cope with high levels of absence as staff are pinged by the test and trace app, leading to the closure of some venues and a drop in output.
The confusion surrounding quarantine and testing rules for international travel is also leading to fresh uncertainty about the prospects for the aviation and tourism industries, which have been struggling through the worst crisis in their history. The lack of warning about the need for travellers from France to isolate for ten days from today, has thrown holiday plans into fresh mass chaos, with hopes of a boost to summer bookings evaporating.
Amidst concerns that infection rates could derail the recovery are worries about inflation heating up and the knock on effect of rising interest rates. 65% of investors believe interest rates will be higher in a year’s time compared to 60% last month. That is the highest level since January 2019. More than a quarter (26%) now believe they could be higher in six months, compared to 24% in June 2021.
Economies have been re-opening with an energy that once seemed unlikely in the depths of the pandemic, which is pushing up inflation. In addition the recession left supply chains broken around the world, leading to some shortages. Companies have also slashed investment during the crisis, so the ability to increase production is limited, which has the effect of pushing up prices even further.
Central banks are largely still talking as a team, stressing that these effects are transitory, kicking the ball of monetary easing down the pitch. But it’s clear investors, watching from the side lines, are increasingly nervous that price rises are likely to linger for longer. More fear that a swifter rolling back of mass stimulus programmes and the spectre of rising interest rates could dampen economic growth and asset valuations.
Jason Tavaria: CEO at InPost, an out-of-home and eCommerce delivery company said: “Many people today – so-called ‘Freedom Day’ – will not be feeling overjoyed. The prospect of returning to the high street against the backdrop of a surge in Covid cases across the UK, will feel more like a gamble than a celebration. And without the social distancing safety net in place, nor a requirement to wear a mask, many shoppers will feel it’s just not worth the risk of rushing back to shop in person – especially those who are at risk and those who aren’t double vaccinated.
“The reality is that many consumers will feel more comfortable shopping online. Retailers need to continue to be empathetic to these very real concerns about Covid and use all the tools at their disposal to give customers both choice and convenience as restrictions disappear. Out-of-home options such as lockers are a practical route to helping deliver a secure, safe and contact-free experience. Instead of having to wait around in queues, customers are able to pick up or return their goods on their own watch, and from a location that suits them. We are currently in a very sensitive situation and retailers must prioritise the safety of customers above all else.”