Newcastle City Centre Businesses Fear Mass Closures

Newcastle City Centre Businesses Fear Mass Closures
A survey by the business improvement district highlights number of businesses that fear long lockdown. Huge numbers of businesses in Newcastle city centre will fail if coronavirus lockdown lasts six months, the area’s business improvement district has warned.

NE1 Ltd has surveyed companies in its area on the economic impact that COVID 19 has had on Newcastle, finding that 54% of those surveyed said they would go out of business if the lockdown lasted six months, with that figure rising to 75% if restrictions went on longer.

Businesses in the city centre mostly backed the Government’s response to the crisis so far, with two-thirds of firms saying Government support has been effective.

But NE1 said Government support measures had “bought time not provided a solution” and that businesses such as cafes and pubs would not be financially viable if forced to open with social distancing measures.

More than half of the companies in the city centre are closed, the survey found, and only 2% are operating as usual. 59% of respondents have seen an 81-100% drop in turnover.

Adrian Waddell, chief executive of NE1 Ltd said: “The research shows that Newcastle’s business community is in a fragile state.

“Coming out of lockdown will be much harder than going into it and needs to be handled very carefully, including with on-going business support. The Government needs to get the lockdown easing right if Newcastle businesses are to make it through. To date, the Government’s support has helped by buying time but it has only delayed decisions that could inevitably lead to job losses and company closures along the way. We need a measured, phased plan for easing restrictions and getting the nation back to work”.

“But the survey shows that timing is crucial. There is a very fine line between protecting the nation’s health and protecting its jobs and long-term economic survival.
“The message from Newcastle’s business community is clear; Government support needs to be flexible, targeted and adaptable as businesses begin to reopen and get back on the path to profitability.”

Town and city centres around the UK went into the coronavirus crisis in some trouble, with the decline in the retail and casual dining sectors sparking a raft of closures over the last two years. Newcastle has fared better than many other centres but has not been immune from those trends, and there have been warnings that city-centre businesses have missed out on some of the support available.

The NE1 survey found that businesses’ greatest concern was the duration of the lockdown, and how social distancing would work in practice as restrictions are lifted.

Companies in the food and drinks sector, in particular, warned that social distancing would cut capacity by between 40-90% in pubs and restaurants, making reopening not financially viable.

NE1 said companies needed clear guidance from central Government, plus continuing support while restrictions remain and then gradual removal as the situation returns to normal.

It also called for a “collaborative effort between Newcastle City Council, NE1, businesses and the general public” so that hospitality businesses can return to work safely.

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