Small and mid-sized businesses are known to have been hit the hardest by lockdown and the Covid pandemic and have reduced cash flow for many companies. The smallest businesses were hit the hardest.
The impact on small businesses was due to working in sectors that have a smaller client base.
Due to many helpful support services provided by the government and external organisations, some of these businesses have been able to recuperate on their losses and stay afloat while rebuilding on their success.
Small and medium-sized businesses in the UK make up almost 50% of the total revenue brought in by businesses in the UK and 44% of the country’s labour force. After the lockdown, 80% of small and mid-sized businesses reported stable and growing revenue for the year before the pandemic started. In 2021, it is known that these businesses are reporting declining revenues and profits together with other negative aspects to the business.
Although the lockdown has affected most businesses, some sectors were hit differently than others as some businesses were not affected in a largely negative manner. The most negatively affected sectors include construction, logistics, and agriculture. More than 90% of Small and mid-sized businesses reported large reductions in their revenue and profits.
Government support has been essential for all businesses in the UK. Demand was high for assistance especially with companies who had more than 10 employees to pay salaries and other costs too. Some of these businesses have applied for reductions in tax and other obligations in order to pay employees and rescue their businesses.
The impact of the pandemic has had a severe impact on small and mid-sized businesses in the UK. Government assistance in helping failing businesses due to the pandemic has been a key element in rescuing the economy.