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Financial Impact

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Key Findings

  • More than 70% of responding enterprises reported a decrease in turnover in 2020 compared to 2019.
  • More than 50% of responding enterprises expressed confidence in having the financial resources to continue throughout the crisis for more than 6 months.
  • Among respondents, 67% reported that their 2020 turnover was less than expected.
  • Among respondents in the Wholesale and Retail Trade sector, 15% reported that their 2020 turnover exceeded expectations.
  • Six in ten respondents reported decreased costs in 2020 compared to 2019.
  • Respondents spent almost 70% of their 2020 COVID-19 spending on measures to comply with requirements for trading.
Turnover
increased
Decreased
between
0% and 10%
Decreased
between
10% and 50%
Decreased
more than 50%
Industry (B-E)27.913.536.921.6
Construction (F) 24124024
Services (G to N,R,S)27103825

More than 70% of responding enterprises in all broad sectors reported a decrease in turnover in 2020 compared to 2019

About three quarters of responding enterprises across Industry, Construction and Services saw their turnover fall between 2019 and 2020.

About a quarter of respondents saw turnover fall by more than half in the year and about 40% saw their turnover decrease by between 10% and 50%.

One in ten respondents in the Services sector saw their turnover decrease by between 0% and 10%. This was also the case for one in eight respondents in the Construction sector and one in seven in the Industrial sector. See Figure 4.1 and Table 4.1

4.1 Percentage changes in estimated turnover of enterprises in 2020 compared to 2019 by sector

Don't knowNot confidentYes longer than
6 months
Industry (B-E)19.120.660.3
Construction (F)24.836.139.1
Wholesale and
Retail Trade (G)
11.631.157.4
Transportation
and Storage (H)
27.141.931
Accommodation
and Food Service
Activities (I)
11.845.243
Professional
and IT (J, M)
11.727.460.9
Finance and
Administration
(K, L, N)
15.722.561.8
Arts,
Entertainment
and Recreation (R)
19.645.734.8
Other Service
Activities (S)
23.836.240
All sectors173152

More than 50% of responding enterprises expressed confidence in having the financial resources to continue throughout the crisis for more than 6 months

Six out of ten respondents in the Finance and Administration (62%), Professional and IT (61%), Industrial (60%) and Wholesale and Retail (57%) sectors expressed confidence in having the financial resources to continue operating throughout the crisis for more than six months.

Over a third (35%) of enterprises in the Arts, Entertainment and Recreation sector expressed confidence in having the financial resources to continue operating throughout the crisis for more than six months, while 46% reported not being confident in having enough financial resources to continue operating. 

More than four in ten respondents in the Accommodation and Food Service Activities (45%) and Transportation and Storage (42%) sectors reported not being confident in having the financial resources to continue operating throughout the crisis for more than six months. See Figure 4.2 and Table 4.2.

4.2 Enterprise confidence in having the financial resources to continue operating for more than six months throughout the COVID-19 by sector

X-axis labelAs expectedLess than expectedMore than expected
Industry (B-E)3065.44.6
Construction (F) 18.974.17
Wholesale and Retail Trade (G)22.36314.8
Transportation and Storage (H)9.383.77
Accommodation and Food Service Activities (I)9.782.87.5
Professional and IT (J, M)36.955.17.9
Finance and Administration (K, L, N)31.463.94.7
Arts, Entertainment and Recreation (R)19.176.64.3
Other Service Activities (S)16.277.16.7

More than 80% of responding enterprises in the Accommodation and Food Service Activites sector reported that their 2020 turnover was less than expected

More than 80% of responding enterprises in the Accommodation and Food Service Activities and the Transportation and Storage sectors reported that their 2020 turnover was less than expected. This was also true for more than 70% of respondents in the following sectors: Construction, Other Service Activities and Arts, Entertainment and Recreation.

In the Professional and IT sectors, 55% of respondents reported that their 2020 turnover was less than expected, and 45% reported it was either as expected or more than expected.

In the Wholesale and Retail Trade sector, 15% of respondents reported that their 2020 turnover exceeded expectations. See Figure 4.3 and Table 4.3.

4.3 Business's turnover for 2020 compared to normal expectations for the year without COVID-19 by sector

Decreased
between
0% and 25%
Decreased
more than
25%
IncreasedNo change
Industry (B-E)32253013
Construction (F) 32322016
Services (G to N,R,S)27322516
All sectors28312516

Six in ten respondents reported decreased costs in 2020 compared to 2019

About six in ten respondents in the Construction (64%), Services (59%) and Industrial (57%) sectors reported decreased costs (fixed costs and variable costs combined) in 2020 compared to 2019.  In the Construction and Services sectors, about one in three respondents reported a decrease of less than 25% with the same amount reporting a decrease of greater than 25%.

Three in ten respondents in the Industrial sector reported increased costs. with the remainder reporting no change.  A quarter (25%) of respondents in the Services sector and one in five (20%) respondents in the Construction sector also reported increased costs. See Figure 4.4 and Table 4.4.

4.4 Percentage changes in costs of enterprises 2019 - 2020 by sector

Spend to comply
with COVID-19
trading requirements
Spend on new
products/processes
to adapt to COVID-19
Industry (B-E)8515
Construction (F) 52.947.1
Services (G to N,R,S)70.429.6
All sectors6931

Respondents spent almost 70% of their 2020 COVID-19 spend on measures to comply with requirements for trading 

Industry sector respondents reported that 85% of their COVID-19 related spending was on measures to comply with requirements for trading and the remainder was on the development of new products / processes to adapt to COVID-19.

In the Services sector, respondents reported that 70% of their COVID-19 related capital spending was on measures to comply with requirements for trading and the remainder was on the development of new products / processes to adapt to COVID-19. See Figure 4.5 and Table 4.5.

4.5 Spend by enterprises to comply with COVID-19 requirements or to develop new products/processes to adapt to COVID-19 by sector

For long labels below use
to display on multiple lines
Pay down overdraftsPay on-going costs
in absence
of expected cashflow
Other
2158

The most common usage of any additional finance drawn down was to pay on-going costs

The most common usage of any additional finance drawn down was to pay on-going costs in the absence of expected cash flow, with 15% of firms reporting that they used additional finance this way. See figure 4.6 and Table 4.6.

4.6 Reasons why additional finance was obtained by businesses during the pandemic

Require less
credit
No significant
impact
Require more
credit and expect
it to be available
Require more
credit and expect
it will not be available
Don't know
Industry (B-E)1576532
Construction (F) 15081131
Wholesale and
Retail Trade (G)
25610626
Transportation
and Storage (H)
23981140
Accommodation
and Food Service
Activities (I)
048151720
Professional
and IT (J, M)
2696420
Finance and
Administration
(K, L, N)
0615727
Arts,
Entertainment
and Recreation (R)
035111737
Other Service
Activities (S)
4409939

More than 80% of respondents across all sectors either saw no impact on the availability of credit or did not know if there was an impact

Almost 70% of respondents in the Professional and IT and 61% in the Finance and Administration sectors reported no impact on the availability of credit, whereas this number dropped to 57% in the Industrial sector and 56% in the Wholesale and Retail Trade sector.

This compares to about half of respondents in the Construction (50%) and Accommodation and Food Service Activities (48%) sectors and four in ten respondents in Other Service Activities (40%) and Transportation and Storage (39%) sectors reporting no impact on the availability of credit.

More than one in five respondents in all sectors reported that they did not know what impact the crisis has had on the availability of credit. See Figure 4.7 and Table 4.7.

4.7 Expected impact of COVID-19 on business's demand for credit in 2021

Go to next chapter >>> Background Notes