Impacts of COVID-19 on Businesses in Australia – 2020

See the second edition report on the impact of COVID-19 on businesses in Australia, produced by St. George Economics, on April 7, 2020

OVERVIEW

The Australian Bureau of Statistics (ABS) today released the results of the second edition of a survey highlighting the prevalence and nature of adverse impacts from COVID-19 experienced by businesses in late March/early April.

The survey was conducted between 30 March and 3 April. The Federal government’s announcement of its third and largest stimulus package to support businesses during COVID-19 on 30 March was the same day the survey collection began.

66% of surveyed businesses said that they experienced a reduction in cash flow or turnover in the previous 2 weeks. Businesses in the accommodation & food services sector were hardest hit. Almost all firms surveyed in this industry reported a reduction in cash flow or turnover.

64% of businesses reported a reduction in demand over the previous two weeks. The accommodation & food services industry and the construction industry reported the greatest proportion of firms experiencing a reduction in demand.

Many businesses have also had to make changes to their workforce arrangements; indeed, 47% of surveyed firms said they had made changes to their workforce. The most common change was the temporary reduction to the working hours of employees.

The JobKeeper payment policy was announced the same day as the survey began and may have had an impact on the decisions of businesses for changes to their workforces.

38% of businesses surveyed said they have changed how they deliver their products and services, including shifting their offerings online.

24% of businesses said they have deferred interest payments on their loans while 26% said they had brought forward investment.

38% of businesses said they had renegotiated their property rental agreements.

29% of businesses reported difficulty in sourcing stock or raw materials.

And 48% reported that government measures to contain the virus, such as social distancing, have impacted their operations.

This report highlights that businesses have already seen a substantial impact to their cash flows in the current environment. It also highlights that businesses are trying to adapt and innovate in this challenging environment.

Download the report: Impacts of COVID-19 on Businesses

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