The biggest threat to Scottish businesses is a second wave of COVID-19
- 69% of Scottish businesses believe a domestic second wave of COVID-19 poses a bigger threat than a no-deal Brexit, according to a BDO LLP poll released today
- More than a third of businesses still expect to expand their workforce in the next fiscal year, indicating recovery as they rebuild workforces.
A domestic second wave of COVID-19 poses a bigger threat to Scottish businesses than a no-deal Brexit, according to the monthly Rethinking the Economy survey of 500 mid-sized businesses.
The poll – conducted by accountancy and business advisory firm BDO LLP - revealed that companies are more concerned about the impact of the ongoing global pandemic, despite the country entering the final three months of an agreed transition period after Brexit.
The UK will leave the EU's customs union and single market on 31 December, regardless of whether a new trade deal is agreed and ratified. However, only 23% of respondents stated that a no-deal Brexit was a more immediate risk to the UK economy – a sentiment replicated across the UK.
Commenting on the findings, Martin Bell, partner and head of tax for BDO in Scotland, said: “The COVID-19 pandemic clearly presents an ongoing threat to Scottish businesses, as they continue to contend with tightening restrictions by the Scottish Government and the reintroduction of local lockdowns in many of the country’s regions.
“With very little detail on what a potential Brexit deal could look like – and how comprehensive and far-reaching it might be – it’s clear that Scottish businesses have placed Brexit further down on the agenda. However, with the clock ticking, it’s essential that companies prepare themselves for life outside of the EU, addressing key areas such as supply chains, workforce, VAT registrations, processes and cashflow.”
Martin added: “While Scottish companies cope with a myriad of political and socio-economic challenges, as well as business and operational concerns, such as making loan payments, managing supply chains and adapting for Brexit, what is encouraging is that more than a third of businesses still expect to expand their workforce in the next fiscal year, indicating recovery as they rebuild workforces. However, many plan to revise terms for employees. Our poll found that 38% of businesses have already altered their terms of employment for more than 10% of respective staff, including job shares and reduced hours.”
Notes to editors
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