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A Quarter of Businesses to Start Up Again in June

As the UK looks to move out of the lockdown phase, many businesses across the country are planning to open up again. A study by the Office for National Statistics (ONS) has revealed some of the figures to bear in mind.

A Look at the Cash Reserves

One of the most worrying figures in this report was the lack of cash reserves that companies hold. 42% of the companies stated that they had less than 6 months of reserves available to them now.

However, only 4% of them confirmed that they have no cash reserves left. With a number of the UK’s biggest companies reportedly in danger of financial collapse, the apparent ability of most of those firms surveyed to continue is an encouraging sign.

Another of the economic indicators released by the ONS showed that 79% of the businesses they surveyed have applied to be part of the Government’s Coronavirus Job Retention Scheme. They say that 27% of workers in these companies have been furloughed.

Figures released by the UK government this week showed that over 10 million workers have either received self-employed income support or been furloughed during the lockdown. This has cost the Treasury almost £22 million to date.

Some analysts believe that the fast, decisive action taken by the Government and the Bank of England has helped to avoid the crisis having an even more dramatic effect on the country’s economy.

Businesses That Are Re-Opening

For some British businesses, the long-awaited return to work has already happened. This is because 8% of the respondents to this ONS survey said that they have started trading again in the last couple of weeks.

A further 24% confirmed that they are planning to start trading again at some point in the next 4 weeks. 31% of businesses think that they will be trading again but that it will take more than 4 weeks for this to happen.

Most retail businesses are set to start up again in June. This will come as a relief for those firms that have been relying upon Government help and international debt collection to get through this difficult period.

The Markets’ Reaction

The financial markets have responded positively, in the main, to the improving situation. Share prices have generally been up in the last week, as investors look ahead to a bright future. Retail, travel and leisure firms are leading the way in this recovery.

One exception is the NASDAQ, in the US, which is down heavily based on fears of a new tax on tech firms. Another area of concern is over renewed protests and uncertainty in Hong Kong, which has led to companies linked to this region suffering in the markets.

The European Commission has also pointed to an increase in customer confidence across the continent. They stated that this number rose slightly, from a disastrous -22 in April to a slightly improved reading of -18.8 in the month of May.

They also pointed out a modest rise in consumer sentiment, which rose from 64.9 in April to 67.5 in May.