A survey of more than 1,270 London businesses found that half of all respondents considered a potential new national lockdown as the most significant risk to the post-pandemic economic recovery – by far their greatest concern.
London Chamber of Commerce and Industry (LCCI) and London Councils published The London Business 1000, which reported the findings from their fifth annual comprehensive survey of 1,276 London businesses. Polling for this unique survey was conducted by YouGov, and the findings provide insight into the challenges faced by businesses and employers as the capital enters the new normal of the post-pandemic economy.
The economic shock from the pandemic-induced lockdowns hit London especially hard. While over a third of business are more confident about London’s economic recovery than they were in 2020, businesses have been unable to shake the fear of new national lockdowns. Set against the backdrop of rising COVID-19 cases, regional and national lockdowns must be very carefully considered, including whether moderate measures could be adopted earlier to curb cases without hitting the economy.
The pandemic has also created huge disruptions in the labour market. While the report found that recruitment in the capital is on the rise (49% of London businesses have hired staff in the last 12 months and 54% plan to recruit more in the next 12 months), over one in five businesses surveyed cannot find applicants with the right skills to fill vacancies.
Other top line findings from the report are:
Remote working remains popular in the capital and is likely here to stay. Only 30% of businesses surveyed reported having no remote workers at the time of the survey
Only 7% of London businesses currently employ apprentices, which may be attributed to misunderstanding around the apprenticeship levy as of those employers required to pay the levy only a third (33%) currently employ apprentices.
Only 22% of large companies face no skills challenges, driven largely by a lack of applicants and increasing competition.
Over two thirds of businesses (69%) are doing at least one activity to reduce their environmental impact, although just half of the businesses stated they have access to the right skills to reduce their carbon emissions further (48%)
London businesses are most likely to see national government (76%) and themselves as firms (75%) as most responsible for helping companies meet greenhouse gas emissions targets
London businesses continue to consider investment in public transport (39%) and the improvement of air quality (33%) as key priorities for the investment of business rates.
Richard Burge, Chief Executive of London Chamber of Commerce and Industry, said:
“The impact of the pandemic has been especially severe on London, but the last few months of free trading and greater openness have greatly benefited the economic climate of the capital. Business leaders are clearly more confident about their futures than last year. While London has shown itself to be a resilient city, a drop-off in footfall would once again devastate businesses of all sizes. If the city is to build back better, the Government must have a clear road to recovery that keeps us out of another lockdown. It would be better to take sensible measures that don’t restrict the economy now than face a lockdown in the winter.
“The Government must also address the disruption that is still roiling the labour market in London and throughout the country. London had the highest furlough and unemployment rates in the country, but businesses are now struggling to find staff. It is vital that Londoners out of work are properly supported in developing the skills needed to fill the roles businesses need.”
Cllr Elizabeth Campbell, Executive member, Business, Economy and Culture, London Councils, said:
“Recovery from the pandemic is the biggest concern for London’s businesses, and so it is imperative that boroughs continue to champion the thousands of successful firms we have here in the capital.
“This year’s survey shows that although London businesses are hiring again, they are struggling to get the skills they need. In addition, the apprenticeship uptake remains disappointingly low. We welcome the Budget’s investment in skills and are committed to working with government to reform the apprenticeship levy to support young Londoners into their future careers.
“The survey also highlights business leaders’ enthusiasm for more sustainable practices. It is encouraging that over two thirds of London businesses are doing at least one thing to reduce their environmental impact. The private sector will be vital in addressing climate change.
“Businesses across London are considering how to prioritise green infrastructure and sustainability, and the business rates reliefs around investment in solar panels and other key infrastructure announced in the Budget will help. Boroughs are committed to advising and supporting our businesses to tackle sustainability challenges head on.
“London’s businesses are a huge part of what makes our city so unique. We must listen to them and work with them to secure London’s environmental and economic future.”
To read the full report visit www.londonchamber.co.uk/LCCI/media/media/Full-report-Business-1000-2021-pdf.pdf
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Find out more about London Chamber of Commerce and Industry at www.londonchamber.co.uk