As the effects of the Coronavirus and the lockdown bites down on businesses globally, a survey by PriceWaterCoopers (PWC) has shown that more than 21 per cent of businesses in the country are already planning to lay off staff as 55 per cent said the current palliative by the federal government will not have impact on their decisions.
The survey which had about 3000 respondents ranging from managers to CEOs and business owners, identified Liquidity and the safety of their staff among the most pressing business needs they are concerned about as they grapple with the impact of the COVID-19 pandemic.
The survey which focused on the economic implications and policy responses to COVID-19 showed that at the top concerns by business operators is liquidity and safety of staff.
Presenting the result of the survey at a webinar at the weekend, Fiscal Policy Partner and West Africa Tax leader at PwC, Taiwo Oyedele noted that 22.5 per cent of businesses expressed concern on the availability of immediate cash to pay bills especially following disruption to business activities that has been experienced.
This was followed by safety of staff at 15.4 per cent, which he said is an impressive indication that Nigerian businesses have a people focus and were not only concerned about their profitability. Businesses also expressed concern on availability of infrastructure for remote working further buttressing the need for access to electricity and internet connectivity.
Oyedele noted that most businesses, more than 78.4 per cent, do not plan to lay off staff as a result of the crisis, presenting a positive picture. However, he said “decisions on staff retention are often top management decisions and it could mean that a good percentage of respondents may not be privy to such plans by their organisations.”
The other 21.6 per cent admit that they will lay off various percentages of staff as a consequence of the pandemic. Of those that admitted that they will lay off staff, 55.3 per cent do not think government intervention will influence their decision on laying off staff with the rest indicating they would retain their employees if government’s intervention were able to take care of varying percentages of their staff wage bill.
As part of its societal impact, PwC has indicated that it would provide free business continuity support services to small businesses employing between five to 50 employees who undertake to retain all their staff during this period.
“It would appear that the much needed investments to stimulate growth and move the needle on poverty will be greatly impacted as a result of the COVID-19 crisis as 56.7 per cent of respondents indicated that they will delay investment decisions while 19.4 per cent stated that they would invest less”, he said.
Majority of the survey respondents think that governments interventions have either been grossly inadequate (23.8 per cent) or inadequate (43.9 per cent) with 17.5 per cent expressing indifference to what government has done up to the date of the survey.
Only 14.4 per cent agree that government’s intervention has met their expectations. This provides a clear message to government both at the federal and state levels pointing either to the need to do more, or to better communicate what is being done already to help shape public perception.
Among the top two areas that respondents believe government’s intervention should be focused include tax relief (30 per cent), provision of loans at zero or low interest rate (29.3 per cent), and cash transfer to the poor (16.9 per cent).
Overall, the businesses surveyed agree that the private sector has a role to play in supporting government’s fight against Covid-19 with 85.5 per cent suggesting that they are best suited to provide support in the area of provision of items, equipment and facilities compared to only 10.7 per cent who will consider donating cash to government.