New study reveals the effects of the pandemic on the motor trades industry

This is how much the pandemic affected every industry 

• The IT industry was found to be the most affected, seeing the biggest increase in business deaths compared to births post-pandemic 
• Data shows the wholesale industry prospered, seeing a sharp decrease in business deaths compared to births from April 2020 onwards 
• Overall, the UK saw a drastic decrease in new businesses after the pandemic

New research has revealed how much every industry has been affected after the Covid-19 pandemic.  

A study by marketing training hub School of Marketing analysed the latest ONS and government data on the number of businesses that were born and died in the last eight business quarters after the pandemic (from Q2 of 2020 to Q1 of 2022) and compared this with the eight quarters before the pandemic (from Q2 of 2018 to Q1 of 2020) to see how each industry has been affected in the last two years. 

The information and communication industry was the worst affected industry by the pandemic. Pre-pandemic, for every 100 businesses born in the industry, 91.51 businesses died. This number had increased by 89% post-pandemic with 173.24 business deaths for 100 new ones. A study by PricewaterhouseCoopers suggests struggles during and after the pandemic in the industry could be caused by decreased overseas consumption and reduced supply of outsourcing due to worldwide restrictions. 

The motor trades industry saw somewhat of a mild change compared to other industries. Pre-pandemic, there were 94.84 business deaths for every 100 births and post-pandemic there were 86.37 deaths for every 100 births, a positive but light change with deaths dropping roughly 8.93%.

It was found that finance and insurance was the industry second-worst affected by the pandemic. Pre-covid, there were roughly 48.01 business deaths for every 100 births. Post-pandemic, this number had increased by 50%, with an average of 71.95 deaths for every 100 business births in the industry. 

The accommodation and food services industry did well under the circumstances. Pre-pandemic there were 90.37 business deaths for every 100 births, and post-pandemic the number of deaths for every 100 births had dropped 10.9% to 80.51.

The wholesale industry also prospered post-pandemic when compared with the others studied. Pre-pandemic, for every 100 wholesale businesses born, 101.5 businesses died. This result decreased by 20% post-pandemic, where in the last eight business quarters, only 81.44 businesses have died for every 100 wholesale businesses born.  

How business births and deaths were impacted by the pandemic 

Industry	Number of business deaths, for every 100 business births pre-pandemic (Q2 2018 – Q1 2020)	Number of business deaths, for every 100 business births post-pandemic (Q2 2020 – Q1 2022)	Post-pandemic change (lower is better)
Wholesale	101.50	81.44	-19.76%
Retail	79.75	69.94	-12.31%
Accommodation and food services	90.37	80.51	-10.90%
Motor trades	94.84	86.37	-8.93%
Health and social care	100.53	94.62	-5.87%
Education	82.85	87.43	5.53%
Construction	80.08	85.04	6.19%
Transportation and storage	78.23	88.96	13.72%
Real estate	60.08	69.22	15.22%
Production	91.31	105.25	15.26%
Agriculture, forestry and fishing	118.93	137.31	15.46%
Arts, entertainment, recreation and other services	89.70	108.60	21.08%
Business administration and support services	89.86	108.87	21.15%
Professional, scientific and technical activities	97.60	142.41	45.91%
Finance and insurance	48.01	71.95	49.86%
Information and communication	91.51	173.24	89.31%
UK Total	86.58	100.67	16.26%

Businesses in retail were found to be the next most successful after the impact of the pandemic. Pre-pandemic there were on average 79.75 business deaths for every 100 business births, and this number has dropped 12% post-pandemic with roughly 69.94 businesses dying for every 100 births since the second quarter of 2020. 

It was also found that in the eight business quarters from April 2018 up to March 2020, the UK average was that 86.58 businesses died for every 100 that were born. Post-pandemic this number had increased by 16%, with current figures showing that for every 100 new businesses, roughly 100.67 have died, making the average number of business births and deaths almost equal since the pandemic began. 

Commenting on the findings, Ritchie Mehta, CEO of School of Marketing said: “This data shows how much more difficult it has become to survive as a business since the pandemic. In the two years before the impact of covid-19 on average more businesses were created than closed each quarter, but now the numbers of company births and deaths are basically equal. As entrepreneurs look to protect themselves against a harsher business environment, the value of skilled employees has never been higher. Therefore SMEs can take advantage of initiatives such as the Apprenticeship Levy scheme to bring in new staff or train current ones in digital and data-led programmes, with the vast majority of the training cost covered by the levy.” 

The study was conducted by the School of Marketing, which offers leading digital and data marketing apprenticeships.  

Further information can be found at https://schoolofmarketing.co/