What is Covid-19 doing to your business?

Words:
Eleanor Young

An RIBA survey reports an inevitable downturn in workload, plus home working, furloughing and a whole range of enabling technologies to learn

Since mid March nearly 60% of architecture practices have seen a downturn in workload, with a similar story for new business. This is the report from more than 1000 respondents to the RIBA survey on the impacts of Covid-19. Gathered over the two weeks to Tuesday 30 March, the survey shows a picture of a profession grappling with the huge economic disruption of the lockdown.

In the fortnight that the survey was open there were government and industry wrangles about whether construction sites should stay open, instructions to work from home where possible and schools closure.

Nationally the picture fits. Business is taking a serious knock. Office of National Statistics fortnightly survey showed 45% of businesses reporting lower turnover (based on two weeks to 22 March).

On the upside for individuals, it is clear that the economic impact has been slower to hit than on other parts of the economy, such as retail. Thirty-three per cent of respondents said that there had still been no impact on their role or income.

But all the signs are that it will affect them soon, with 57% reporting reduced cash flow – problematic when cash flow can bring even a profitable practice down thanks to the fixed costs of salaries. Government supported furloughs for staff may help and avoid a high level of redundancies; when the survey was taken, 3% said that some colleagues had been made redundant. Extra costs from this period, for example of investing for home working or taking legal advice on site inspections and contract administration, have taken money off the bottom line with reports of increased costs and unrecoverable outlays (21%).

Figure 1: What impact has Covid-19 had on your practice/workplace?
Figure 1: What impact has Covid-19 had on your practice/workplace?

The crisis is inevitably affecting the development of projects; 79% report project delays. Clients are putting projects on hold, some planning authorities have reportedly stopped posting public consultations (although the chief planner has urged them to provide the best service possible) and many building sites have closed (61% report being affected by closures). There are also project cancellations – nearly 40% of respondents have suffered from these. Considered with the reduction in new enquiries it is clear that the pipeline of projects will be severely disrupted.

Figure 2: What impact has Covid-19 had on projects your practice is involved in?
Figure 2: What impact has Covid-19 had on projects your practice is involved in?

By around the third week in March, only a quarter of respondents to a similar, smaller, survey by the Architect’s Journal said that most employees were working from home. The RIBA survey spans this period and the week following Boris Johnson’s urging of people to work from home. Despite architects continuing to ask for advice on how to deal with employers still wanting them in the office the RIBA survey shows that 81% were now working from home and 70% said that some or all colleagues were doing so.

With this has come new challenges – mastering Zoom or similar at one end and working without a printer, dealing with processing speeds on large files and remote server or cloud access at the other. New communication difficulties were reported by 30%. In the survey the general impact on productivity was raised as an issue and personal experiences bear this out; 30% also say that caring responsibilities are disrupting work.

Figure 3: What impact has Covid-19 had on you personally?
Figure 3: What impact has Covid-19 had on you personally?

The crisis at all levels is taking its toll on individuals. The uncertainty is one element that was raised in comments on the survey. This personal stress is seen in clearer focus when you understand that one third of respondents are reporting a drop in household income, and 45% in personal income. Almost a third report that they have self-isolated. Unsurprisingly many feel their mental health has deteriorated (23%) and feel isolated (21%).

Figure 4: What impact has Covid-19 had on your role/income?
Figure 4: What impact has Covid-19 had on your role/income?

During the survey period – and since – there have been various announcements about government support through deferred VAT and on business rates to support for the self-employed and for businesses wanting to keep on staff but unable to afford it during this period (furloughing, as explained here). With a fast changing picture and some of the packages still to be fleshed out it is hardly surprising that only 38% had so far applied for this support. However, the vast majority (86%) said that they were considering applying to one or other of the government’s support mechanisms.

The RIBA's chief executive Alan Vallance said: 'The findings of this survey show how that COVID-19 is having a severe impact on architects, professionally and personally. For many architects, their work is more than a way to earn a living, and to see decades of hard work threatened by circumstances none of us can have foreseen is a disaster.  

The RIBA remains committed to responding to the needs of its members, and will carry on providing the information, guidance and support they need so that architects can weather this storm.  

We will continue to lobby the Government to protect the income of all affected architects, expand support schemes to cover directors’ dividends and shift economic policies to provide businesses with the security they need.  

During this extremely unsettling time, I call on employers to prioritise the welfare and wellbeing of their staff. This means enabling them to work from home flexibly where possible, and taking advantage of the Government’s Job Retention Scheme. The RIBA is currently asking the Government to give grants or expand capital allowances so that companies can purchase or rent computer equipment to make it easier for employees to work productively and collaboratively at home.  

Above all else, we must all prioritise our own physical and mental health, and seek support if needed.  

The RIBA will continue to guide and support the profession as we navigate through the coming weeks and months.'


See architecture.com for more information on the coronavirus and architecture

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