Tuesday 8 December 2020 3:16 am

The economic recovery is coming — and it will be powered by micro-businesses

Irana Wasti is president of GoDaddy (EMEA)

I wouldn’t be the first to talk about how incredibly difficult 2020 has been for small businesses. 

And based on the chancellor’s economic forecasts last month, those challenges look set to continue for the foreseeable future.

The worst economic downturn in a generation, thousands of businesses and their employees out of work, and continued uncertainty which will last well into the new year.

Read more: Posters and adverts aren’t enough to prepare business for Brexit, says BCC

But within that broad picture, how is the pandemic impacting everyday entrepreneurs, and what does that tell us about what needs to happen to move forward? That was our aim at GoDaddy, as we set out to survey the new and current micro-businesses (nine employees or fewer) that we serve each day.

Using both official Office for National Statistics data and GoDaddy’s own growth in venture figures, we found (potentially surprising to some) a number of regional and largely suburban hubs of significant economic activity, across the entirety of the country. 

In these suburban micro-business hubs — such as Warrington in the Midlands, Bolton in the North West and Caerphilly in Wales — our State of the Nation report found significant increases in the numbers of new businesses launched in the first quarter of this year. 

This is corroborated by a smaller but still significant rise (14 per cent) nationally in micro-business births between April and June 2020 — at the first peak of the pandemic. Such a rise shows the ingenuity of these entrepreneurs, who decided to take the plunge and launch a company at the most disruptive time imaginable, all in a matter of weeks.

To support these new entrepreneurs and those who have adapted their business models to respond to Covid, we hosted our Back to Business Virtual Roadshow, where we digitally travelled the length and breadth of the country to help us understand specific concerns and issues in local areas.

The first thing to say is that the confidence these entrepreneurs have of recovering quickly post-Covid is a testament to the resilience of micro-businesses. From the suburbs of North London to the heart of the West Midlands, a majority were confident that their business would be able to bounce back from disruption by early next year.

However, what also came through loud and clear is the importance of the government delivering the right support. The firmly held belief in Greater Manchester, for example, is that the Tier 3 restrictions had a far greater negative effect on businesses than the national lockdown did. Indeed, 49 per cent of those asked thought the Tier structure was more negative for their business, with only 12 per cent thinking it would be less painful for them than the first wave lockdown. They are of the view that, so long as a tiered lockdown system is in place, a post-Covid recovery will be harder to achieve.

That should provide food for thought for the government as we head into the Christmas season in earnest. And for the rest of us, we should take pride in the resilience of our entrepreneurs, and support them at this critical time. For small businesses, the holiday season is often the most important of the year, and never more so than this December. 

Buying local isn’t often just the most convenient and efficient way to buy presents this year, it may also be the way to save countless small businesses and inject some momentum into our post-Covid recovery.

Our micro-businesses are counting on us — and, in the long run, we are counting on them too.

Read more: Dial “Enterprise, Enterprise, Enterprise” for this economic emergency

Main image credit: Getty

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.

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