The economic bounce back and the small business landscape
Small manufacturing and construction businesses are currently seeing the strongest post lockdown recovery rates
Earlier this month, the Office of National Statistics (ONS) released data revealing that the UK economy had recovered by 1.8% in May.
This was met with a level of uncertainty, with social media polls run by Startups.co.uk showing that the majority of our followers thought the 1.8% GDP growth was either disappointing or not enough to draw a conclusion.
A recent report by Yahoo Finance contains the results of a PMI survey carried out by banking group Natwest, and it seems like the economic landscape looks promising for small businesses but is by no means set to soar.
The survey, which collects data from businesses employing one to 49 people within the manufacturing, construction, and services sectors, reveals a sustained rebound over the course of June for small businesses, thanks to the easing of lockdown measures.
While the figures don’t indicate growth (a PMI score above 50 is required for that), the jump from a score of 26.3 in May to 42.5 in June does indicate that the small business sector is showing signs of recovery post lockdown.
Small manufacturing companies saw some of the biggest signs of recovery, while the services sector recorded its highest PMI score since lockdown began in March.
That said, the small business sector hasn’t seen the same recovery levels as larger firms, with disruptions to supply chains and material shortages partly responsible for the slow start.
This survey comes as Bank of England governor Andrew Bailey reports of an uneven economic recovery so far, with car and housing markets recovering fairly swiftly, compared with the struggling hospitality and entertainment sectors.
In fact, a recent study has revealed that 30% of people won’t take a holiday this year, while 50% of people are planning on spending less on their summer holiday.
As far as the retail sector goes, shops that cater to the DIY, sports, outdoor, and electronic markets have seen the best signs of recovery. But with 56% of people still avoiding the high street, it’s certainly a long way off until we start to see a significant economic bounce back.