Who survives the lockdown economy?
6 January 2021: Writing for the Financial Services Faculty, Laura Miller asks whether some businesses and sectors will be able to survive lockdown.
Coronavirus has accelerated a reshaping of how we work and consume, triggering a series of dramatic corporate successes and failures that look increasingly likely to be permanent, as companies struggle and strive to keep up.
As the UK enters its third national lockdown and the Chancellor announces another £4.6bn of business support, consumer behaviour has already changed over the course of 2020.
Billions of pounds of government-backed support have not been enough to save every large company, with hospitality and fashion retail bearing the most severe closures and job losses as lockdowns made their services unobtainable and products redundant.
Communication and consumerism have moved online at an even faster pace than pre-COVID-19, proving astonishingly profitable for tech giants and grocers able to deliver everything from video conferencing to vegetables.
“For e-retailers, even with a mass vaccine rollout programme on the horizon, the accelerated shift to online may start slowing but is unlikely to reverse”, says Susannah Streeter, senior investment and markets analyst at wealth manager Hargreaves Lansdown.
Employers are also increasingly accepting online over the office as a permanent feature not a bug, in a hybrid new deal for white-collar staff told to work from home. Property businesses predicated on leasing to large corporates in need of city centre workspace are already nursing losses they may never recover.
Companies that can think like disruptors will be best placed to weather the incoming economic storm. Firms are being forced to prove the value of their resilience planning or adapt some on the hoof. Vaccines may inoculate us against the virus but not the recessionary scarring still to come.
You can read a full feature on this here.