Business for Goals Platform (B4G) released the Report on Results of the Second Survey on the Impact of COVID-19 Crisis on Enterprises, conducted in coordination with TURKONFED, TUSIAD and UNDP. Administered online and responded by 619 enterprises with 60% micro and small, %40 medium and large enterprises, the survey intended to capture the impact of COVID-19 Crisis on Enterprises with 26 questions on the predictions on evolution of the crisis and what measures were needed by the enterprises.
The first Survey on the Impact of COVID-19 Crisis on Enterprises was conducted between 23-27 March 2020 and the second between 11-22 May 2020. Results revealed a slightly diminishing impact of the crisis on enterprises from March to May. The impact of the crisis on enterprises slightly decreased from March to May. . 85% of enterprises reported adverse impact in March, whereas 78% did so in May. The hardest hit were micro enterprises at 69%, followed by small enterprises at 49%, whereas the rate was 31% for large ones. COVID-19 Crisis was reported to have a higher impact particularly on women employees and more than half of the enterprises were not prepared against a second wave.
COVID-19 Crisis mostly hit micro and small enterprises
The survey assessed the impact of COVID-19 Crisis on enterprises in 44 provinces of Turkey, where 35% of micro and 24% of small enterprises fully stopped operations. 33% of micro enterprises reported severe difficulty in payments, whereas only 2% of large enterprises did so. Enterprise scale in terms of workforce size is inversely related to the impact from COVID-19 Crisis. Micro enterprises had the highest rate of substantial impact at 69% whereas the rate was 31% for large-scale ones. Further, 76% of the respondents reported no change in workforce size, and micro and small enterprises constituted the majority of those whose workforce was reduced by more than 50%.
64% of enterprises deferred new investments and growth plans
Enterprises, by their current risk perception, viewed this crisis as a crisis of domestic and foreign demand, rather than a financial one. Low domestic and foreign demand stood out as areas of highest risk. Investors’ deferring investments was also viewed as high risk.
61% of enterprises reported filing application for short-time working allowance, whereas the remaining 39% did not file because it would not meet their needs or they would not fulfil the eligibility criteria. 44% of respondents received aid for short-time working allowance. Results indicated that such support was inclusive and provided to those enterprises which needed most. About 50% of small, medium and large enterprises received such support. 47% of enterprises obtained new loans or restructured existing ones.
Increased workload due to COVID-19 Crisis affected women workers more adversely
COVID-19 Crisis was reported to have higher impact particularly on women workers due to increased domestic responsibilities such as child care, care of ailing family member, hygiene and food safety. 34% of enterprises which observed difficulties regarding work-life balance due to covid-19 crisis reported that consequences affected women more adversely than men. The fact that enterprises with a higher ratio of women managers reported a higher impact on women might be indicative of gender-sensitive awareness and perspective in such enterprises particularly on work-private life balance and domestic responsibilities. By sector, particularly the women workers in healthcare faced more difficult conditions.
59% of enterprises are not prepared against a second wave of COVID-19 pandemic
48% of enterprises reported that their working capital could carry them forward at most three months if COVID-19 Crisis continued. 22% reported insufficient working capital or would suffice for one month at most. By scale, of the enterprises with insufficient working capital for short run, 32% were micro and only 6% were large-scale ones. 24% of respondent enterprises thought their sector would change significantly after the crisis, whereas only 5% expected that all would remain the same.
Ms. Ümit Boyner, President of the Executive Board of Business for Goals Platform, said: “As we all know, the world and our country are going through a critical, challenging process due to COVID-19 pandemic. As the Business for Goals Platform aims to build a bridge between the business world and Sustainable Development Goals and strengthen the role of business world in sustainable development, we conducted two surveys to study the impact of COVID-19 Crisis on enterprises. The first was conducted between 23-27 March, 15 days following the confirmation of the first COVID-19 case in Turkey, eliciting responses from 780 enterprises, mostly SMEs, on risk perceptions, preparedness and expectations. Upon its conclusion, we as Business for Goals Platform jointly with our partner UNDP developed new projects in response to COVID-19 Crisis in Turkey, and filed applications to access international funds, for which we are now receiving affirmative responses. Based on the outputs from the first survey, we held online meet-ups with enterprises on matters they needed. Our main topics included labour law, foreign trade, how women were affected by the changing life styles, contributing to SME digitalisation during the COVID-19 crisis including such vital matters as receiving short-time working allowance to positively affect business continuity. As we have all predicted, it is micro and small enterprises that are hit hardest by COVID-19 Crisis. We saw that 35% of micro and 24% small enterprises fully stopped operations. Challenging issues include the continuation of mandatory payments such as salaries, taxes, rents, bills etc. COVID-19 Crisis does not only affect today, but also has the potential to lead to long-term consequences by shaping the future expectations and plans of enterprises. The fact that the results from our survey work will be used as input data for the “Socio-Economic Impact Study” report currently being conducted by the United Nations globally and regionally is a testimony to the value of our work. We will continue to work actively to develop new projects for enterprises in Turkey.”
Mr. Claudio Tomasi, UNDP Turkey Resident Representative said: “UNDP Turkey continues its work on inclusive and sustainable development, democratic governance, global warming, environment, development cooperation with private sector, Syrian refugees and host communities, gender equality and so forth. COVID-19 is not merely a health crisis, but also an economic and human development crisis. We may define this crisis as the biggest socio-economic crisis of our age that triggers inequalities, ecological imbalance and insecurity, and affects nations socially, economically and politically.
Since the confirmation of the first case in Turkey on 11 March 2020, we as UNDP Turkey have been closely monitoring the developments. We have first directed our resources and activities in Turkey to transform the adverse impact of COVID-19 pandemic. We support national and local initiatives developed by the private sector to solve development problems in the framework of the Sustainable Development Goals.
It is crucial to support SMEs facing resilience challenges against disasters and pandemics. UNDP Turkey, assists in alleviating the devastating economic impact of COVID-19 by its work for all segments of the society by its principle of inclusiveness. The results of the second survey revealed that Syrian-owned enterprises were hit harder by the pandemic. In May, 38% of Syrian-owned enterprises fully stopped their operations whereas the rate was 30% for Turkish micro and small enterprises comparable in scale to Syrian ones, and 22% across all Turkish enterprises. There was no Syrian respondent reporting no impact from the crisis, and 81% reported substantial impact. As a further note, the results of both surveys undertaken by Business for Goals Platform will be used as input data for our UNDP’s work at global and regional scale for a comparative analysis of countries.”
About Business for Goals Platform: Acting on the philosophy that all actors in the society have a role to play for sustainable development, founded jointly by TURKONFED, TUSIAD and UNDP, the Business for Goals Platform is the world’s first-ever Think-Do-Tank platform launched by private sector initiative. Centred on the 17 Sustainable Development Goals of the United Nations on issues ranging from poverty to climate change, from gender equality to environment, the Platform aims to muster the private sector, public sector and NGOs on the common denominator of “sustainable development” and formulate roadmaps guiding the private sector to becoming a solution partner for development.