Businesses in Ceredigion have yet to fully recover from the effects of the Covid-19 pandemic, a wide-ranging report by academics at Aberystwyth University has found, with “significant changes in business revenue and levels of external debt”.

The report, The Economic Impact of the Covid-19 Pandemic on Ceredigion Businesses and the Self-employed, draws on the experience of 77 businesses and self-employed individuals and identifies some of the main challenges they faced.

According to the study, 92 per cent of businesses reported difficulties, including falls in customer numbers and revenue, and disruptions to supply chains.

Despite the availability of various government-backed business support schemes at the time, the authors conclude that many businesses have still not returned to normal and have called for policy responses to address what they describe as “ongoing long-business Covid effects”.

Figures contained within the report show that a total of 3,965 businesses are operating in Ceredigion, with 92 per cent of those considered to be at the micro level – employing zero to nine people.

The Covid-19 pandemic “affected the economy and the livelihoods of the people behind” those small businesses, the report outlines.

While more businesses have opened than closed in Ceredigion since 2017, the pandemic “exacerbated” the decline, figures show.

“Our findings show significant changes in business revenue, levels of external debt, changes in demand and customer numbers and disruptions to supply chains since the onset of the Covid-19 pandemic,” the report said.

“Changing operations to comply with government restrictions e.g. social distancing, increased sanitisation and cleaning and staff with caring responsibilities working from home considerably changed the business environment.

“In addition, the necessity to operate online led to a marked increase in businesses having to provide computing devices, internet connectivity and digital accessibility for their operations.”

The report finds that the “impact of Covid-19 on the revenue of businesses surveyed was negative for over two thirds of the sample”.

The level of external business debt rose for 33 per cent of the businesses, and 15 per cent of businesses had to apply for a loan repayment holiday during the pandemic.

Despite the initial closures and impacts on many businesses, no businesses surveyed in Ceredigion had applied for bankruptcy as a result of the pandemic at the time of the survey.

A total of 82 per cent of businesses reported a drop in the number of customers, with 63 per cent seeing a fall in cash flow.

The study found that three per cent of businesses closed permanently due to the pandemic, with 69 per cent closing temporarily.

“After the initial shutdown and closure of businesses the majority were able to function in some capacity,” the report adds.

“95 per cent of businesses in Ceredigion did not close permanently.

“Three per cent of self-employed closed permanently while 35 per cent closed temporarily.”

More than 40 per cent of businesses reduced staff hours, with 13 per cent laying off staff due to the pandemic.

Over half of the businesses surveyed registered for the UK Government furlough scheme, but the self-employed were not eligible for that scheme, with help only coming a few months later through a separate scheme.

“The delay in setting up the scheme contributed to the financial hardship for small businesses,” the report found.

“Lockdowns and other Covid-19 containment measures had a direct negative impact on business operations and supply chains, “ the report outlines.

“Staff were made redundant, some worked from home, self-isolated due to infection, took paid or unpaid sick leave, undertook home-schooling or other caring responsibilities.

“All these impacted negatively on businesses through changes in working hours, work patterns and employee responsibilities.”

The report’s authors are Dr Aloysius Igboekwu, senior lecturer in finance and director of postgraduate studies; Dr Maria Plotnikova, lecturer in economics; and Dr Sarah Lindop, senior lecturer in finance at Aberystwyth Business School.

Speaking at the launch of the report on Tuesday, 19 September, Dr Igboekwu said: “Although the short-term effects, such as supply chain disruptions and a fall in customer numbers were substantial, evidence from our survey responses suggests addressing the ongoing long-business Covid effects should be a priority for policymakers.”

The survey was made available to all businesses and self-employed in Ceredigion.

The survey period ran from April to June 2021.