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Business Indicators, Business Impacts of COVID-19

Insights into the prevalence and nature of impacts from COVID-19 on businesses operating in Australia

Reference period
May 2020
Released
28/05/2020

Key statistics

  • 72% of businesses had less income as a result of COVID-19.
  • 74% of businesses actively trading changed how they operate.
  • 73% of businesses accessed support measures.
  • Social distancing restrictions are expected to impact 71% percent of businesses over the next two months.

Business impacts of COVID-19 survey

This publication provides information on the incidence and nature of impacts due to COVID-19, as experienced by businesses operating in Australia. The survey was conducted between 13 May and 22 May 2020.

Topics covered in this release include:

  • Operating conditions of businesses;
  • Changes in revenue and finance arrangements;
  • Changes in employee arrangements;
  • Future business impacts and conditions.
     

The collection was conducted through a telephone based business survey between 13 May and 22 May 2020, with a sample size of 2,564 businesses. The final response rate was 56% (1,430 responding businesses).

This release forms part of the suite of additional products that the ABS is producing to measure the impact of the COVID-19 coronavirus. Future information collected in this survey will evolve to maintain relevance in a changing environment.

Operating conditions of businesses

Overall, 74% of actively trading businesses reported that they were operating under modified conditions due to COVID-19.

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  1. Proportions are of businesses currently trading.
  2. Modified conditions include shifting more operations online, or operating with a reduced workforce.

By employment size, the proportion of actively trading businesses operating under modified conditions were:

  • 73% of small businesses (i.e. 0-19 persons employed);
  • 82% of medium sized businesses (i.e. 20-199 persons employed);
  • 87% of large businesses (i.e. 200 or more persons employed).
     
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  1. Proportions are of businesses currently trading.

The ability for businesses to operate as normal has been affected by the COVID-19 pandemic; more than 50% of businesses in every industry reported operating under modified conditions.

The largest proportions of businesses that reported operating under modified conditions were in the Information media and telecommunications (96%), Health care and social assistance (93%), Accommodation and food services (92%) and Education and training (91%) industries.

Changes in revenue and finance arrangements

Revenue impacts of COVID-19

Overall, 72% of all businesses reported decreased revenue as a result of COVID-19.

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  1. Proportions are of all businesses.
  2. The sum of the component items do not equal 100% due to rounding.

By employment size, 71% of small businesses (i.e. 0-19 persons employed) reported that revenue had decreased as a result of COVID-19 compared with 78% of medium businesses (i.e. 20-199 persons employed) and 73% of large businesses (i.e. 200 or more persons employed).

Businesses operating under modified conditions were more than twice as likely to report a decrease in revenue compared to those that were operating normally (83% compared with 37%).

Changes in business revenue, by operational status(a)

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  1. Proportions are of businesses currently trading in each employment size category. 
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  1. Proportions are of businesses currently trading in each employment size category. 

Four in five small businesses (83%) operating under modified conditions reported that revenue had decreased as a result of COVID-19, compared with 37% of small businesses that were operating as normal.

By industry, businesses in Transport, postal and warehousing were the most likely to report a reduction in revenue (95%).

Over half of all businesses in Retail trade (53%) reported that that revenue had decreased as a result of COVID-19, however, 44% of businesses in this industry reported that revenue had increased as a result of the pandemic.

Business access to support measures

Businesses reported whether they accessed support measures as a result of COVID-19:

  • over half (55%) of all businesses reported that they had accessed wage subsidies (e.g. JobKeeper, apprenticeship wage subsidies etc.);
  • approximately one in five (19%) businesses reported having renegotiated property rent or lease arrangements;
  • 16% of all businesses reported that they had deferred loan repayments;
  • 38% of all businesses reported that they had accessed other government support measures.
     
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  1. Proportions are of all businesses.
  2. Businesses could provide more than one response to the question.

By selected industry:

  • More than two thirds of businesses in Education and training (67%) and almost three in five businesses in Arts and recreation services (57%) reported having accessed wage subsidies as a result of COVID-19.
  • Over a quarter of businesses in Accommodation and food services (27%) reported having deferred loan payments.
  • Renegotiation of property or lease arrangements was reported by more than a quarter of businesses in the Health care and social assistance industry (26%).
     

Businesses that sought additional funds

One in ten Australian businesses (11%) reported they had sought additional funds as a result of COVID-19.

Source of additional funds

Of the 11% of all businesses that sought additional funds, over half (57%) of these businesses sought additional funds from financial institutions. A quarter of businesses (26%) reported having sought additional funds from the business owners’ personal line of credit or savings.

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  1. Proportions are of businesses that sought additional funds.
  2. Businesses could provide more than one response to the question.

Changes in employee arrangements

Information was sought from businesses about selected changes in their employee arrangements in response to COVID-19.

More than half of all businesses (53%) reported that hours worked by staff had reduced, while a quarter (24%) reported having reduced the total number of employees working for the business.

Changes to employee arrangements in response to COVID-19, by employment size(a)(b)

 Reduction in the total number of employeesHours worked by staff currently employed reducedReduced the hourly rate of pay for any employeesApplied a wage freeze for any employeesStaff on paid leaveStaff on unpaid leave
%%%%%%
Small (0-19 persons)
23
53
5
4
6
5
Medium (20-199 persons)
51
56
8
12
35
22
Large (200 or more persons)
41
51
9
11
33
32
All businesses
24
53
5
4
8
6
a. Proportions are of all businesses.
b. Businesses could provide more than one response to the question.
 

Large businesses were almost twice as likely to report a reduction in the total number of employees working for the business, compared with small businesses (41% and 23% respectively).

Of the businesses that were operating under modified conditions, two thirds (67%) reported changes to employee arrangements, compared to 26% of business trading as normal.

Future business impacts and conditions

Expected impact of government restrictions

Businesses were asked to what extent they expected government restrictions to impact the business in the next 2 months.

Expected impact of government restrictions in the next two months, by extent of impact(a)(b)

 Not at allSmall to moderate extentTo a great extent
%%%
Restrictions on trading
37
35
29
Social distancing restrictions
29
46
25
Travel restrictions
50
24
27
a. Proportions are of all businesses.
b. The sum of some of the component items do not equal 100% due to rounding.
 

By industry, businesses in Accommodation and food services (75%) and Arts and recreation services (67%) were the most likely to report that trading restrictions are expected to impact the business to a great extent over the next two months. Businesses in these two industries were also the most likely to report that they expect social distancing restrictions to impact the businesses to a great extent over the next two months (50% and 68% respectively).

Businesses in Mining were the least likely to report that they expect trading restrictions and social distancing restrictions to impact the business to a great extent over the next two months; however, 45% of Mining businesses reported that they expect travel restrictions to impact the business to a great extent over the next two months.

Requirements to return to pre-COVID-19 business conditions

Businesses were asked to report what else, aside from the relaxation of government restrictions, is required in order to return to pre-COVID-19 business conditions. Presented below are the most commonly reported responses by businesses.

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  1. Proportions are of all businesses.

Business impacts of COVID-19 visual summary

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Business Impacts of COVID-19 Survey results

The following section describes the visual summary presented above.

Business impacts of COVID-19 include differences in revenue, sources of additional funding or support, and changes in operating conditions.

  • 72% of businesses had less income as a result of COVID-19. For 7% of businesses revenue has increased, and for 22% revenue has stayed the same.
  • 1 in 10 businesses sought additional funds. 57% of those borrowed from banks or financial institutions, 26% sourced from a personal line of credit or savings and 21% sourced funds from other businesses.
  • 74% of businesses actively trading changed how they operate. 27% of businesses with 0 to 19 employees are operating as normal, while 73% are operating with modifications. 18% of businesses with 20 to 199 employees are operating as normal, while 82% are operating with modifications. 13% of businesses with 200+ employees are operating as normal, while 87% are operating with modifications.
  • 73% of businesses accessed support measures. This includes wage subsidies (accessed by 55% of businesses), renegotiated rent or lease arrangements (accessed by 19%) and deferred loan payments (accessed by 16%).
  • Social distancing restrictions are expected to impact 71% percent of businesses over the next two months. Trading restrictions are expected to impact 63% and travel restrictions 50%.


Detailed data on the impacts of COVID-19 can be found at abs.gov.au/covid19

Technical note - questionnaire

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Supplementary business survey - Business impacts from COVID-19

1(a) Is your business currently trading?
 ☐ Yes [Go to Question 2]
 ☐ No [Go to Question 1b]
  
 (b) Is the halt in business trading a result of COVID-19?
 ☐ Yes [Go to Question 3]
 ☐ No [End of survey]
  
2Since the start of March, what changes has this business made to its operations, as a result of COVID-19?
 ☐ None, continued trading as normal
 ☐ Continued operating under modified conditions (such as shifting more operations online, or trading with a reduced workforce)
  
3How has COVID-19 impacted the revenue of this business?
 ☐ Decreased
 ☐ Increased
 ☐ Remained the same
  
4Has this business accessed any of the following support measures as a result of COVID-19? (Yes / No / Don't know)
 ☐ Deferred loan repayments
 ☐ Renegotiated property rent/lease arrangements
 ☐ Wage subsidies (e.g. JobKeeper, apprenticeship wage subsidies)
 ☐ Other government support measures
 ☐ Other support measures (please specify) 
  
5Has this business sought any additional funds as a result of COVID-19?
 ☐ No
 ☐ Yes [Go to Question 5a]
  
 (a) From which of the following has this business sought additional funds? (select all that apply)
 ☐ Business sought additional funds from bank or financial institution
 ☐ Owners’ personal line of credit or savings (e.g. redraw facility on an existing loan)
 ☐ Friends or family of existing owner(s)
 ☐ Other individual(s)
 ☐ Other businesses
 ☐ Other sources (please specify)
  
6Has this business made any of the following changes to its workforce in response to COVID-19: (Yes / No / Don't know)
 ☐ Reduced the total number of employees working for this business
 ☐ Reduced the number of hours worked by staff currently employed
 ☐ Reduced the hourly rate of pay for any employees
 ☐ Applied a wage freeze for any employees
 ☐ Placed staff on paid leave
 ☐ Placed staff on unpaid leave
  
7(a) To what extent do you expect the following government restrictions to impact this business in the next 2 months?
 Restrictions on trading such as forced closures or restrictions to on-site operations? (select one only)
 ☐ Not at all
 ☐ To a small extent
 ☐ To a moderate extent
 ☐ To a great extent
 Social distancing restrictions? (select one only)
 ☐ Not at all
 ☐ To a small extent
 ☐ To a moderate extent
 ☐ To a great extent
 Travel restrictions (including state, interstate and international travel)? (select one only)
 ☐ Not at all
 ☐ To a small extent
 ☐ To a moderate extent
 ☐ To a great extent
  
 (b) Aside from relaxing government restrictions, what is needed for this business to return to its pre-COVID-19 trading conditions? (interviewer coded response)
  

Data downloads

Business impacts of COVID-19 May 2020