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Covid 19 : Local action required to address the needs of business owners and the unemployed in Bucks.

February 11, 2021 1:53 PM
By Roy Abraham

Roy Abraham

Almost 20% of private businesses in Bucks are now at some risk of insolvency and the number of people receiving out of work benefits has grown 270% since the start of the pandemic.

As we move through the pandemic and beyond, more proactive, locally- targeted strategies will be required by Buckinghamshire Council to address the needs of micro/small businesses and underemployment, particularly among local young people.

The impact of the pandemic on local business and rates of unemployment in Buckinghamshire has been far reaching and profound. For many businesses, its negative effects will continue for the foreseeable future. Key indicators of insolvency risk, declining cash flows and turnover all show critical impact for a large number of local businesses.

There are approximately 25,600 registered businesses in Bucks. More than 90% of local enterprises are micro businesses (with 9 or fewer employees). Based on the data from the Office of National Statistics (mid December), it is estimated that 18% of Buckinghamshire businesses are at risk of insolvency, including 440 at severe risk of insolvency and a further 4,050 at moderate risk of insolvency.

When we consider turnover, 43% of private-sector registered businesses in Buckinghamshire were experiencing lower than normal turnover for the time of year in mid-December. This equates to approximately 11,000 firms. Consistent with the national picture, it is businesses and mostly smaller businesses within the hospitality, travel, arts, entertainment, leisure and education sectors that are most likely to report being at severe or moderate risk of insolvency.

Over 14,000 businesses in Buckinghamshire have secured government-backed loans to help support them through the pandemic (Source ONS). While these loans, along with business rate relief, will certainly have helped some businesses to cope through the pandemic, more locally-targeted initiatives will be needed to sustain and support business, particularly micro and small business owners as we emerge from the pandemic.

Research by Capitalbox states that 50% of SME business owners in the UK do feel that their business will in fact recover this year, but to ensure micro and small local businesses prosper in Buckinghamshire, the council must drive and support the following priorities:

  • Increasing investment in ICT, including broadband : Where businesses are looking to relocate in the next two years, almost one in five gave the need to find faster broadband as a key reason for moving.
  • Improving the supply of affordable commercial property - addressing the shortage of suitable commercial premises for the county's small and home-based businesses to grow into.
  • Facilitating easier recruitment to small businesses - this involves

multiple strategies, e.g. employers with similar skills needs working together in partnership with further education to deliver undergraduate provisions that address specific skills gaps.

  • Developing local skills and talent: encouraging business incubation in the higher education sector to stimulate youth enterprise and graduate enterprise
  • Business Support Services : enhancing the provision of networking, training and support to help businesses learn, grow and prosper.

Those most adversely impacted by unemployment in Buckinghamshire due to Covid-19 include young people, the low paid, those on zero-hour contracts, those who are self employed who are earning over the threshold for financial support, and those unable to work from home or caring for children.

According to Department of Work and Pensions data, claimants of out-of-work benefits in the county stand at 4.6% of working age persons. The number of claimants has grown more than 270%, with 9,415 more claimants in Buckinghamshire in December 2020 than at the onset of the Covid-19 pandemic in March 2020. 16-24-year-olds have been most adversely affected by this with a 290% increase in out- of-work claimants since the start of the pandemic!

To help address unemployment amongst 16-24 year olds, the government launched 'Kickstart' jobs, a £2bn programme to stop young people drifting into long term joblessness. Despite the 5 months since 'Kickstart' started, most job roles for young people are not yet filled, as reported by the BBC. The various lock-downs and bureaucracy associated with the programme may play a part in the lack of take-up.

The Liberal Democrats believe Buckinghamshire Council must be more proactive as a major employer in the county to address youth unemployment and actively engage with local business in youth unemployment programmes. Councils have an enormous variety of roles and functions in the community and can be instrumental in propelling the 'Kickstart' programme in training and preparing young people for productive roles within the council and further afield.