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Deloitte Survey Shows Big UK Businesses See Recovery By Second Half Of 2021

Deloitte Survey Shows Big UK Businesses See Recovery By Second Half Of 2021
A new survey that was published on Monday showed that almost half of the biggest companies of the United Kingdom are of the opinion that businesses will be able to completely recover from the novel coronavirus pandemic only by the second half of 2021. This survey casts a shadow on hopes of a speedy recovery of the economy from the pandemic. 
Forecast of a return to pre-pandemic levels of business would be possible only in the latter half of next year, said 49% of chief financial officers from large and mostly listed companies, found a the survey that was conducted by accounting firm Deloitte.
The report also noted that an additional 33 per cent of the businesses forecast a recovery for businesses by the first half of 2021 while only about 10 per cent of the business leaders said that businesses have already started exhibit a bounce back.
The survey also dived into a other gauges of business sentiment, such as the Bank of England's Decision Makers' Panel, which showed that businesses were expecting a long lasting hit from the pandemic outbreak that has already killed more than 45,000 people in the United Kingdom.
On the issue of their outlook for jobs, there was a resolute downbeat sentiment expressed by the companies, Deloitte said. The companies also predicted a hit on investment and a risk to their balance sheet. These parameters however were better than the previous quarterly survey done by Deloitte.
"Major corporates are expecting a long haul back to pre-COVID levels of revenue," said Ian Stewart, Deloitte's chief economist. "COVID-19 overshadows all other sources of risk for UK CFOs, and by a wide margin."
A call for the UK government to extend its job furlough scheme by another six months for key industrial sectors was given separately by the manufacturing trade body Make UK on Monday. The furlough scheme is set to come to an end in October.
According to a scenario published in May by the Bank of England showed that the UK economy could get back to its pre pandemic levels in the second half of next year. But that would mean a  "V"-shaped recovery, the evidence for which is patchy.
"At present, the prospect of a V-shaped recovery for industry seems remote," said Stephen Phipson, Make UK chief executive. "Therefore, if we are to mitigate the worst impact of potential job losses Government must extend the furlough scheme for key strategic sectors to provide them with vital breathing space."
UK government budget forecasters said last week that there would be a more than 14 per cent contraction in the British economy for the current year if the hit form the novel coronavirus pandemic leaves a lasting negative impact. The scenario also contends that government borrowing would be pushed to nearly half a trillion dollars.
The UK economy was showing signs of a recovery from the coronavirus induced lockdown, said BoE Governor Andrew Bailey on Friday. But he noted that there was weakness in some job-intense sectors and the outlook for the economy in the long terms as unclear.
The Deloitte survey conduce the survey between June 26 and July 8 and comprised of 109 chief financial officers from companies.

Christopher J. Mitchell

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