Bleak future for small enterprise sector – survey
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JOHANNESBURG – NEW research results from the BeyondCOVID Business Survey paint a bleak picture for the future of the South African small business sector one year after the outbreak of the Covid-19 pandemic. Forecasts assume that a total of 1.2 million employees will be laid off over the next six months.
The specialist management consultancy Redflank carried out the BeyondCOVID Business Survey between July 2020 and March 2021, in which almost 4,500 companies were surveyed, more than half of which were micro-enterprises.
The survey found that 26 percent of small, medium and micro businesses said they were forced to close their doors and 7 percent permanently.
According to BeyondCOVID, a registered not-for-profit, small businesses were 26 times more likely to close than their businesses, and they would need rand 1.1 trillion in aid if they hoped to close in the next 12 To stay open for months.
A snapshot of the results found that 21 percent of the companies surveyed have closed, although 64 percent said they expect to reopen. Around 54 percent of companies said they were working under capacity, while 41 percent planned to lay off their employees in the next six months.
Construction, housing and food, manufacturing and ICT were hardest hit, with the public sector, healthcare and financial services least affected, the report said.
It found that a third of companies had expressed funding needs over a six-month period to continue trading for the next year. Companies expected the recovery to pre-Covid-19 levels of 3.5 years to now take six months longer, compared to their forecast of three years at the start of the pandemic.
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