Sydney is Australia's largest city. Its population exceeds 5 million people and it contributes over 24% of the Gross Domestic Product (GDP) of the Australian economy.
The cluster of activities in Sydney city and its surrounding town centres creates an economic engine and a symbiotic relationship amongst its businesses. It generates competitive value for the businesses in this area and in return businesses benefit from increased connectivity, access to labour and talent, infrastructure, and the flow on effects of innovation.
Sydney, like many other cities globally, was largely brought to a standstill by COVID-19 and its associated health and government regulations. Sydney city and its surrounding town centres experienced a significant fall in economic activity whether measured by foot traffic, business revenue, tourist numbers, public transport usage, office occupancy rates, retail spending, or other measures, causing a devastating impact on this economic ecosystem.
There have been many initiatives implemented in order to reignite Sydney's economy and support businesses. Some of these have been at the Commonwealth Government level, others at the State and Local Government levels. Although, the most high profile of these has been the JobKeeper wage subsidy, other measures are also part of a targeted approach to revive and revitalise businesses in Sydney, and the Business of Sydney. These include though are not limited to: the Cash Boost and other government grants, payroll tax deferrals and reductions, the waiver of certain local government fees, the instant asset tax write-off, the Apprenticeships Incentive Program, and more recently the relaxation of restrictions and activation of public spaces.
The Sydney Business Report outlines how COVID-19 has changed businesses in Sydney and is changing the Business of Sydney. It draws directly on the Sydney commercial community made up of large, medium, small and micro businesses and analyses the different ways and different extents that businesses have been impacted, and highlights the different challenges and opportunities they face. Critically, this Report also provides key insights that can be used by businesses to Build Back Better.
It also provides CBD Sydney Chamber of Commerce Members - and businesses it is connected with - an opportunity to share their experiences. It is a collaboration with the Sydney Business Chamber and Vincents Accountants that will be built upon for future research.
Focus Areas for the Research
We asked businesses in Sydney city and surrounding town centres about how their businesses had been impacted in the three (3) months prior to the Survey period in Aug 2020. The full Report contains detail on different industries and levels of impact, however the key findings can be summarised as follows:
How were business in Sydney City and surrounding town centres affected by COVID-19?
85% said revenue had been impacted to some degree. The most common response by 24% of respondents was a reported decrease of between 30% and 50%.
55% had stood down or terminated staff.
61% reported their workforces were either partially or fully working from home or remotely.
77% experienced a negative impact on their mental health.
What did businesses in Sydney City and surrounding town centres do in response to the economic effects of COVID-19?
76% were utilising Government temporary assistance - but 24% were not.
65% had sought to negotiate rent with their landlords. Of these 88% had utilised the Government's temporary assistance measures.
And 68% had received some form of rent reduction.
On Finance costs only 28% sought to negotiate with their bank or finance provider - and 70% did not seek any such negotiations.
61% of businesses had reduced employee and staff costs.
How have businesses adapted as a result of COVID-19 and how confident are they in surviving?
33% indicated that all staff will return to the workplace when COVID-19 is under control.
24% indicated staff will continue to work remotely.
87% of businesses considered it likely that their business model will need to change.
What do businesses say they require to survive and move forward in a "COVID Normal" environment?
74% indicated were confident or somewhat confident their business would survive - however. Of these, 98% had not experienced a revenue decrease of more than 75%.
59% advised their business would require further funding and financial assistance.
Build Back Better
While the objective of the Report was to understand the impact of COVID-19 on businesses within the Sydney city and surrounding town centres, the Report is also designed to improve clarity and start discussions around how businesses are performing now and what support they will need moving forward.
The Report details a number of recommendations based on the key points identified by the research.
One key finding relates to staying informed. When asked "What have been the most useful sources of information and support during COVID-19?" - there were four (4) key responses from eight (8) options provided:
- 23% Professional advisors
- 20% the ATO
- 17% Commonwealth & State Governments and
- 14% Chambers of Commerce
Chamber Membership Counts. Be A Member
This CBD Sydney Chamber connects, engages and supports businesses and people in business to achieve the best possible outcome - whatever the business conditions.
The Chamber provides access to clear information, business support services, upskilling opportunities, the roundtable specialist series and the Women in Business Network, the Chamber can be a valuable support in moving through the current economic challenges.
That's why Membership Counts.
For a copy of the Sydney Business Report or enquiries about Chamber Membership contact Peter May - Executive Officer CBD Sydney Chamber on 02 9350 8103 or 0437 872 052, cbdsydneychamber.com.au/why-join
The Sydney Business Report is a collaboration between Sydney Business Chamber, CBD Sydney Chamber of Commerce, and Vincents Accountants. It is the first in a series of reports which analyse and address key issues that impact the Business of Sydney