The latest Quarterly Economic Survey for Northern Ireland shows that the immediate impact of the Covid-19 crisis will be worse than the 2008/2009 financial crash.
People around the world are bracing for a major financial crash in the wake of the Covid-19 crisis, and Northern Ireland is no exception. While many NI tech firms have been adapting well to remote work, 69% of businesses across Northern Ireland expect their business prospects to deteriorate in the next year, and 17% expected not to survive the economic impact of the virus.
The latest Quarterly Economic Survey from Northern Ireland Chamber of Commerce and Industry (NI Chamber) and BDO was released this week, and it has some daunting statistics and dire predictions for the region. The headline finding is that the immediate impact of the Covid-19 outbreak is expected to be much worse than the 2008/2009 financial crash.
A surprising 77% of businesses in Northern Ireland have furloughed employees using the NI Government's furlough scheme, and 12% have made staff redundant. Around 23% have reduced staff hours or moved permanent people into temporary roles, and 52% of those surveyed said they planned to reduce staff levels after the crisis.
The nature of work is expected to change with around 62% of respondents confirming plans to add more flexible working and work-from-home options on an ongoing basis, but that could be bad news for Belfast's booming office construction industry. Around 24% of those surveyed said they plan to reduce office space.
Ann McGregor, Chief Executive of NI Chamber, commented on the report: "This survey reflects the fall out of arguably the worst economic and social crisis of our lifetime. In terms of the economy, the vast majority of indicators dropped to historic lows, with declines far exceeding those seen at the height of the global financial crisis."
"Businesses were already concerned about the impact of Brexit on the economy before COVID-19 however the recent pandemic has placed this in an entirely different context – with companies facing a ‘double whammy’ of Brexit and the COVID-19 fallout, placing a huge challenge on the business community in Northern Ireland."
NI Chamber made a series of recommendations in the report to help business get back on track, including specific targeted funds and investments to deal with the fallout of the Covid-19 crisis. Investment in helping firms redesign their businesses for the post-Covid-19 world and change products and services was suggested, in addition to reskilling and upskilling programmes to help companies hire.
Source: Written based on press release
