North West chambers express concern over Brexit and Covid

Eighty-one percent of businesses on both sides of the border in the North West have said they will not be hiring new staff or expanding their workforce within the next year, a major new survey has found.

A joint survey of over 130 North West businesses between the Londonderry and Letterkenny Chambers of Commerce revealed serious challenges for companies in the region over key issues like Covid-19 and Brexit.

A further 58% of companies have said they envision making cuts this year to protect their business and already badly hit revenue streams.

The chambers are calling on the governments in Stormont, Westminster and Dublin to work collaboratively with business to reach solutions around pandemic restrictions which allow companies to continue trading, or to properly compensate them if their doors are forced shut or they experience a fall in trade.

Despite the current dominance of Covid-19 for businesses on both sides of the border, firms are still seriously concerned about the potential impact of the end of the transition period at the end of this year also.

The survey found 72% of respondents said Brexit would have a damaging and negative effect on their businesses in both the short and long term. Businesses have several outstanding concerns ahead of 31 December including increased paperwork and bureaucracy, barriers to trade, loss of business and customers, exchange rates fluctuations, supply chain interruptions, and access to skills and workforce.

A significant proportion of North West businesses – over a fifth – have not made any specific preparations ahead of the end of the transition period, while only 5% have reported signing up to the UK Government’s new Trade Support Service.

In a joint statement, Paul Clancy, Chief Executive, Londonderry Chamber and Toni Forrester, Chief Executive, Letterkenny Chamber said: “The results of this survey make for sobering and deeply worrying reading.

“While the impact of Covid-19 has been clear for all to see, the evidence of its devastating impact on our entire regional economy has been laid bare.

“At a time when redundancies and job losses are unfortunately inevitable and rising, it is concerning but unsurprising that over 80% of firms will not be hiring over the next 12 months. Governments across these islands need to put in place the necessary schemes and supports which will shield one of Ireland’s historically most deprived regions at a time of growing unemployment.

“Our survey has highlighted the importance that government support schemes have played in keeping our local businesses afloat since March. 81% of respondents told us that, without these schemes, it is likely that their businesses would have been lost during the pandemic. “Even with these schemes, every business reported having lost significant percentages of their revenue over the past six months.

“Covid-19 remains the immediate anxiety for business owners, but a slightly higher percentage of respondents – 84% - said that Brexit posed the greatest challenge to the North West region over the next 12 to 24 months.

“Just over two months until the end of the transition period, the future trading environment is as an unclear as ever. 62% of businesses said that they were either unprepared for Brexit or unsure what they needed to do.

“We are again pleading with the UK Government to deliver clarity and certainty for our local economy and ensure every effort is taken to guarantee uninhibited trade across our islands,” the statement added.

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