The financial impact of COVID on Teesside’s Independent Businesses

As the region faces stricter lockdown measures there are fears that this will have immediate impact on small, independent businesses on Teesside.

TuXtra reporter Hannah Conway took to the streets of Middlesbrough to see how these businesses have been affected by the new restrictions implemented by the Government.

With the new lockdown restrictions coming into place, the hospitality industry could arguably have been affected the most – with the 10pm curfew, and now only one household being allowed out to socialise in any indoor setting.

Bier and Bier is a small bar situated on Albert Road in Middlesbrough, owned by Michael and Sam. With the new restrictions of Tier 2 placed on Teesside opening the bar is “much worse than being closed.”

Michael said: “From a business point of view the new restrictions are killing the hospitality sector. We followed all of the government guidelines to the letter when we re opened in July. Myself and Sam sat for hours writing risk assessments and making my business covid safe.

“We have only used table service since we reopened as well as social distancing between tables, hand sanitisers and regular cleaning of the premises as well as many other restrictions. These restrictions were hard enough but we were doing ok and business was as good as could be expected.

“Since the newer restrictions were introduced we have had to reduce capacity to about 30% of normal due to most people being couples. This is pretty much working at a loss when we are open. The 10pm curfew is the final nail in the coffin, we don’t usually get busy until 9pm. Now we are asking people to leave at that time.

“In my opinion the restrictions are encouraging people to have house gatherings which is much much worse as these are not covid safe environments with zero social distancing going on. I feel like the hospitality industry is an easy target, they can show pictures of people drunk in crowds which show a very small minority and a snap shot and convince the public that pubs are the problem, when in fact the vast majority of venues are excellent.

“Again my opinion but the data shared by government advisors does not back up the view that pubs are responsible for the spike as 6 weeks after re opening there was no increase in cases. There was however a massive spike 2/3 weeks after schools and universities opened. But again hospitality is getting the blame for this spike. I would have no issue closing my premises in the interest of public safety if we were fully compensated by the government.

“As it is now in Tier 2, is much worse than being closed as we have to remain open, pay for stock, staff, electricity etc but we simply do not have the customers / footfall to pay the bills. Middlesbrough has some amazing local independent bars, cafes and restaurants. I really hope the majority can make it through this and remain open. It will be a sad sight to see them closed permanently, but without adequate government support there will be a lot that will not reopen if we are forced to close or remain in Tier 2 for a long period of time.” 

As well as the hospitality industry being affected those who are self employed have also been punished by the new restrictions too.  Rachel Noonan, owner of Sublime Beauty Therapy is a work-from-home salon providing nail art and skin treatment to customers.

 

Rachel told us all about how she is keeping her business COVID-safe and how it has affected her.

She said: “Personally I got off rather lucky in terms of my business. As I was just setting up branding myself and gaining clients was the same time we were shut down. Due to the fact I was not earning anywhere near minimum wage I was able to claim universal credit so I was lucky in the sense that I didn’t loose all my earnings, but I know many people have suffered as a result of the self employment scheme as they can barely afford rent. 

 

“However once I was allowed to re open in salon I actually left it for a week or two as I felt, personally, it was still unsafe to do so. I now spend extra on PPE and cleaning equipment. I also have to ensure no client arrives near another client leaving so sometimes it feels like I am waiting around and wasting time.” 

“Most of all it is important that my clients feel safe and do not mix with each other in the salon.” 

With small businesses and self employed suffering most from the new impact of the Tier 2 restrictions, the local councillors are stating that the restrictions pose a ‘real threat’ to the economy, it is almost essential that the Government release extra funding immediately for the area to help keep businesses open and the town alive.

The leaders of the 5 councils, Redcar and Cleveland, Darlington, Stockton, Hartlepool and Middlesbrough Council, said that the restrictions were “disappointing but inevitable”.

Redcar and Cleveland, Darlington and Stockton who were previously not in a lockdown, have now had restrictions imposed, whereas for Middlesbrough and Hartlepool restrictions have been slightly lifted – meaning friends and relatives can now meet in gardens and public outdoor spaces to socialise (as long as they meet the requirements for the Rule of 6).

The leader’s released a joint statement about the new restrictions:

“It is disappointing that more areas of the Tees Valley are facing restrictions but given the levels of infection it was inevitable that the Government would make such decisions,” all five said.

“The restrictions pose a real threat to our economy and it is vital that the Government approves our funding requests immediately; they will allow us to provide timely local support to local people to offset some of the effects of the restrictions.

“We cannot emphasise enough the importance of this. A very significant proportion of our economy relies upon the hospitality and leisure sector, and there appears to be no funding support for this sector at Tier Two. We are extremely concerned not just about the short -term economic impact but also the longer-term consequences for our region.”

“Our businesses need time to plan for the changes and we believe there should be a reasonable amount of time before the new measures are introduced to allow this to happen,” the leaders continued.

“Our priority remains to keep everyone in the Tees Valley safe and to protect jobs and we will do everything possible to make sure this happens.”

With the new restrictions having impacts on a lot not business’ in the area, councillors are also encouraging people who have to shut shop to apply for the new Job Support Scheme that has been introduced.

This is where the government will aim to support eligible businesses by paying two-thirds of each employee’s salary (67%) up to a maximum of £2,100 a month, although businesses will still need to pay national insurance and pension contributions.

Businesses who are eligible will be those whose premises are legally required to shut for some period over the winter, as part of local or national government coronavirus restrictions, will be able to receive grants to pay the wages of staff who cannot work. This includes businesses that are forced to close their premises but continue to provide only delivery and collection services, or offer food and drink outdoors.

For further information about restrictions and what is happening in your local area, please check the Government website at: https://www.gov.uk/coronavirus.