IoD: ‘Bleak business outlook shows need for exit path’

Business leaders are pessimistic about the fortunes of their firms well beyond the current lockdown, a new survey from the Institute of Directors reveals today.

A poll of over a thousand directors conducted last week about their organisation’s prospects over the coming 12 months showed a net balance of -22%. This indicator, running since the EU referendum, has never before shown a negative reading.

The IoD, the professional institute for company directors, suggested the figures should encourage the Government to publish – even in outline – the stages that the UK would go through to re-open the economy. Its members, directors of organisations of all sizes, were ‘clamouring’ for information, the IoD said.

Meanwhile, business leaders’ net confidence in the economy overall shrunk to the lowest level yet recorded by the tracking survey (-69%), with investment intentions for the year ahead also hitting the lowest figure collected by the IoD. Revenue and employment for the same time period are all also anticipated to fall dramatically.

Jon Geldart, Director General of the Institute of Directors, said:

“Over the last few days the clamour from our members for information on how, and when, coronavirus-related restrictions will begin to lift has increased substantially. Directors from all parts of the UK need to make plans for riding out this tempest, but they can’t get very far if they have no idea what will be happening in a few weeks’ time.

“The Government faces a near-impossible task in protecting the nation’s health while also thinking about how to let businesses restart. Directors do not in any way want to be reckless, quite the opposite. They want to know how they can get going again safely in a way that supports efforts to make sure the virus is kept under control.

“It’s in everyone’s interests to get the economy off life support when it’s safe to do so. Business leaders know this will not happen all in one go, but that’s why it’s even more important to tell them what they need to prepare for.”