The Covid crisis has had a major impact on the UK economy and there is no doubt that things will get worse before they get better. However, one of the problems we have just now is, in my opinion, that the mainstream media simply cannot wean themselves off their daily diet of bad news. As companies announce thousands of redundancies and small surges of the virus shut down local communities, it’s hard to keep calm and carry on. But according to a recent survey, small businesses are showing the resilience and can-do spirit that, at the risk of sounding cliched, are just what we need to keep the economy going while the big, negative headlines are made by the banks and airlines.
This survey suggests that nearly one third (29%) of SMEs have simply carried on regardless and not needed to make changes to keep going throughout the crisis. However, this does, of course, mean that over 70% have had to take action of some kind or other and this is reflected in the fact that over a quarter (26%) of SME employees surveyed feel pessimistic (16%) or very pessimistic (10%) about their job prospects. A further 26% were somewhere in the middle, being neither confident nor pessimistic, with 48% therefore being confident (31%) or very confident (17%) about their job security. That said, for many business owners the cost of the coronavirus has been considerable, with 14% not paying themselves at all and 18% taking a pay cut. It’s here, in our opinion, that the government should have stepped in, as they have done with the furlough and SEISS schemes.
Communication is seen as vital in an SME. The short distance between the boss and the workers should make it easier for a small business owner to communicate with his or her staff and that’s reflected in this survey suggesting that 80% of workers believe their management are being open and transparent about the state of the company’s finances. That’s very important in my view as it shows a degree of trust which, I suspect, will be reciprocal and thus good for the long-term success of these companies.
In a crisis such as this, with recent reports suggesting substantial increases in the numbers suffering depression and other mental health issues, good communication helps reassure individuals and reduce stress. It was good to read that 50% of respondents to this survey said they felt very supported by their employer, while 28% felt supported but believed their employer could do more. Unfortunately, for over one fifth (22%), it seems that their mental health was not something that concerned their boss. This is also borne out by another survey we know of in the IT industry, which showed the far worse result that only 36% of employers were providing support for health and wellbeing.
Small firms are never really in the national news, other than in their collective from when the likes of the Chamber of Commerce or FSB make a statement. Any type of business can be destroyed by technological change or a pandemic like this, but because, typically, the numbers going at SMEs are relatively small, they don’t make the press, even if they are cumulatively greater than some of the headline redundancy figures from the blue-chip/FTSE firms whose brands are household names. I suspect the same applies to this study: no-one outside their immediate business contacts probably knows anything about these SMEs and how they are doing. However, that’s not to say we shouldn’t celebrate their success and, as we’re doing here, highlight the staying-power of those SME companies who do so much good the length and breadth of the country (including the likes of M&S Accountancy & Taxation!). But above all, there is one lesson in this survey that I think everyone should take home, and that’s the importance of transparent and regular communication between business owners and employees.
Stewart McKinnon, Director, M&S Accountancy & Taxation.