City Hall report: A quarter of London businesses on brink of collapse
Almost a quarter of London businesses are on the brink of collapse, according to new figures from City Hall.
A YouGov survey commissioned by City Hall’s London Growth Hub found 23 per cent of the capital’s businesses won’t last more than two months of the coronavirus lockdown, which began on 13 March.
The report found that five per cent said they could not last more than one month.
It also said that 36 per cent of London’s businesses would require rent relief over the next six months to stay open.
The report comes as the Office for National Statistics announced today that the UK’s economy contracted by two per cent in the first quarter.
This was on the back of a 5.8 per cent drop in GDP in March when the UK’s Covid-19 lockdown began.
With GDP set to plummet in the second quarter, chancellor Rishi Sunak told The Telegraph today that Britain was set for a “significant recession”.
Mayor of London Sadiq Khan said he had written to Sunak and business secretary Alok Sharma to outline his concerns about the future of London’s private sector.
He said: “I’ve written to the chancellor and the secretary of state for business to outline my concerns and urge them to continue to take whatever action is needed to support our economy and to fight off unemployment, homelessness and poverty.
“That must urgently include more help for small and medium-sized businesses which are struggling to pay rent and making more companies eligible for government support grants.
“The effects of the lockdown will be far-reaching and long-lasting. minsters must give businesses the help they need to stay afloat to support the capital’s economic recovery in the future.”
Sunak extended the government’s job retention scheme yesterday to October, while also promising that no furloughed worker would see a dip in pay.
The scheme will stay the same until the end of July, with the government paying 80 per cent of wages up to £2,500 a month to furloughed workers.
From August to October there will be changes to the scheme, with employers asked to chip in to pay some of the 80 per cent and part-time workers allowed to claim on the scheme.