Employment lags as economy rebounds – business news 6 August 2020.

6 August 2020.

James Salmon, Operations Director.

According to the latest PMIs, employment lags as the economy rebounds, more warnings as furlough comes to an end, predictions of a construction boom, interest rates, covid-19, markets, and a lot more business news.

Here are CPA we want to  share the business news stories we have seen that we think will affect our members and readers. Many of us are busy fighting to protect our businesses and therefore might have missed some of the news that could impact small businesses, their owners and those that sell on credit.

Employment lags as private sector sees resurgence

The IHS Markit/Cips composite purchasing managers’ index (PMI) has found that the private sector rebounded at its fastest rate in five years last month.

Tim Moore, economics director at data firm IHS Markit, noted that “Higher levels of service sector output were almost exclusively linked to the reopening of the UK economy after lock-down measures and the subsequent return to work of employees and clients.”

Meanwhile one-third of purchasing managers who responded to IHS Markit’s survey reported a drop in employment.

Duncan Brock, group director at the Chartered Institute of Procurement & Supply, noted that “The threat of further pandemic lock-down threatens to derail continuing progress,” warning: “Business will have to continue to absorb any additional costs coming their way or face the prospect of having to close their doors permanently.”

BCC issues warning as furlough scheme comes to a close

A spending plan announced by the Treasury to protect British jobs has failed to stop firms from laying off staff as furlough support ends, with British Chambers of Commerce (BCC) co-executive director Claire Walker noting that: “Expected usage of schemes announced in the Summer Statement is relatively low, indicating they do not provide the right kind of support for many businesses at this critical time and a rethink is needed.”

She went on: “With confidence and demand not returning at the scale firms need, the Government must take radical steps to slash the tax burden around employment to help companies pay valued staff.” The BCC is also calling for a significant boost to the Employment Allowance, as well as an increase in the threshold for employers’ National Insurance contributions.

Supply of temporary workers at 20-year high

The latest jobs report from KPMG and the Recruitment and Employment Confederation shows demand for permanent and temporary jobs fell again in July as businesses adjusted their staffing requirements. The KPMG/REC index for permanent and temporary placements rose from 34.3 to 44.7 and from 33.5 to 45.1, respectively. The report said: “The supply of temporary workers rose at the fastest rate in two decades of data collection, while the upturn in permanent labour supply was the second sharpest on record.” James Stewart, vice-chairman at KPMG, said: “It’s encouraging to see the downturn in recruitment easing. However, we are still a long way from being out of the woods.”

Working families affected by Coronavirus given an extra boost

Working parents or carers, who are eligible for Tax-Free Childcare or 30 Hours Free Childcare but have temporarily fallen below the minimum income requirement as a result of the pandemic, will continue to receive financial support until 31 October, the Government has announced. Families will receive a £2 government top-up for every £8 they pay into their child’s account, up to the value of £2,000 per child, or £4,000 per disabled child in financial support. The money can be used towards the cost of qualifying childcare for a child up to the age of 11 or 17 for a disabled child. HMRC’s Deputy Chief Executive and Second Permanent Secretary, Angela MacDonald, said: “We want to make sure families will not be adversely affected by any abrupt change in circumstances, which is why we have extended available support through Tax-Free Childcare to give families that extra boost.”

Johnson hopes planning shake-up will trigger construction boom

Small builders are set to benefit from a cut in planning regulations in England with ministers looking at exempting small sites from taxes paid to fund local infrastructure and affordable housing. Robert Jenrick, the housing secretary, said: “These once-in-a-generation reforms will lay the foundations for a brighter future […] We will cut red tape, but not standards, placing a higher regard on quality, design and the environment than before. Planning decisions will be simple and transparent, with local democracy at the heart of the process.”

Fast-growing smaller UK companies face £15bn funding shortfall

New research from the ScaleUp Institute, Innovate Finance, and Deloitte estimates that fast-growing SMEs in the UK face a £15bn funding deficit this year.

Interest rates

As expected, the Bank of England held interest rates at record lows and also maintained its existing level of asset purchases, while investors watched for indications that the bank is anticipating a slower economic recovery. The Monetary Policy Committee (MPC) voted unanimously against extending its bond-buying program, having announced an additional £100 billion expansion in June which took the total value of the Asset Purchase Facility to £745 billion. The bank said they didn’t predict the recession to be as deep as previously expected with the economy only falling 9.5% this year instead of 12.5% as previously expected but said the recovery will take longer than previously forecast.

Today’s announcement further highlights the long term nature of our country’s economic recovery. In the short to medium term,  we are facing a significant double dip recession that could last well into late 2021 and the economy will be hurt by both SMEs closing and mass redundancies for a significant part of the workforce.

With pressures piling up, a lot of SMEs will become unsustainable. We are seeing a resurgence in ‘zombie companies’ where businesses are servicing debt from remaining cash flows with little or no capital for investment and according to The City UK, it is estimated that UK businesses may build up £100 billion of debt by next March which they would be unable to repay with 780,000 SMEs in danger of insolvency. SMEs are not just the lifeblood of the economy, it is where innovation and creativity happens – their existence must be safeguarded.

CPA has developed systems to help SMEs who sell on credit B2B  to uncover large compensation claims for late payments they have suffered in the past. SMEs that are struggling for finance, who have been hit by the current crisis and might even been considering insolvency could find they are actually sitting on a fortune. See the sections below –CPA is passionate about late payment and Do you realise you could be sitting on a fortune?

Dunkerton: Rates decision puts high street at crossroads

Superdry CEO Julian Dunkerton warns in a piece for the Telegraph that if business rates return at the same levels next year it will bring carnage to the high street and lead to a future of “decay and depression” that will prove “impossible to reverse”. However, if the Government makes the right decision on rates and tax for online retail giants the current crisis could prove a catalyst for a new wave of retail entrepreneurs.

Covid-19 general news

Global cases now top 18.8 million; deaths surpass 707,000

Lockdown Restrictions are being reimposed in Aberdeen following a sharp spike in infections in the region, Scotland’s First Minister Sturgeon said today. Pubs and restaurants are among venues to close from 5pm today as part of the containment measures.

Facebook removed a post by Donald Trump’s re-election campaign where the president made the incorrect claim that children are “almost immune” to covid-19. Although the symptoms of children a usually milder than those in older ones, they still catch the virus and can spread it. Facebook said the post violated its policy around “harmful COVID misinformation”. Twitter suspended the Trump campaign’s account on similar grounds.

The rate of infection slowed in the USA, but California had its second highest level of deaths, and the rate of test positivity in Texas exceeded 15%. North Carolina paused its reopening, extending closures of businesses including bars, movie theaters and bowling alleys for five more weeks. The American Centre for Disease Control also had to issue a warning against drinking hand sanitizer after 15 cases of methanol poisoning, including four deaths, in May and June.

Sweden who showed a marked difference to other nations on lockdown, keeping its economy going as much as possible, saw it’s GDP fall by 8.6% between April and June, compared with the previous three months  while most of its European neighbours recorded double-digit drops. The country’s own health officials admit that their policy led to a far greater death toll.

Germany recorded the highest number of new coronavirus cases in more than three months, though still well below the peak reached in early April

Cases in the Philippines have surged to almost 120,000, eclipsing Indonesia to become the region’s biggest outbreak.

Investors should consider the risk of a successful vaccine unsettling markets by sparking a sell-off in bonds and rotation out of technology into cyclical stocks, Goldman Sachs Group Inc. said.

More than half of Canadians are afraid to go back to their workplaces and 77% are worried their colleagues might show up infected with the covid-19, according to research from KPMG. About six in 10 say they’ll will refuse to go back if they believe their place of work is not safe enough and 57% are concerned about sharing meeting rooms and other common areas.


Yesterday the FTSE 100 climbed 1.14% to 6104.72 and the Eurostoxx 50 was up 0.43% as positive commodity prices boosted the market.  In the US the S&P rose 0.64% and the NASDAQ was up 0.52%. In Asia, the Chinese, Hong Kong and Tokyo stock markets retreated as tensions increased between the US and China

The Pound is strengthening following the MPC meeting and is currently at 1.316 USD and 1.109 Euros.

The UK service sector activity expanded at its fastest pace in five years in July as lockdown measures eased and businesses reopened. IHS Markit’s PMI advanced to 56.5 points in July, up sharply from 47.1 in June and the fastest rate of growth seen in the last five years as businesses reopened across the country. New orders also rebounded, reflecting an improvement in corporate and household spending.

US Non-Farm Employment rose by 167,000 in July, according to ADP Research Institute. The increase was sharply below market expectations for a rise of 1.2 million.

The Oil price rose to its highest level since the lock-down on a drop in US crude inventories and the weak US dollar, but mounting covid infections weighed on the demand outlook. Although it remains down 30% on the year to date.

The Gold price soared to a record high again yesterday earlier as a weakening US dollar, falling returns on US bonds and a break above historic resistance at the $2,000 an ounce level all added momentum to buying by investors seeking safe havens for wealth.

Digital Services Tax leads to hike in Amazon seller fees

Seller fees on Amazon will be increased next month after the tech giant decided it will no longer absorb the UK’s digital services tax. The firm stated: “While the legislation was being passed, and as we continued our discussions with the Government to encourage them to take an approach that would not impact our selling partners, we absorbed this increase. Now that the legislation has passed, we want to inform you that we will be increasing… fees by 2% in the UK to reflect this additional cost.” Mike Cherry, national chairman of the Federation of Small Businesses, remarked: “The tax is aimed at the profits of multinationals with large revenues. Passing the tax on to their small business customers will hurt them at the worst possible time.”

M&Co to axe 380 jobs

M&Co is to close 47 stores and axe 380 jobs as part of a major restructuring the high street chain said will secure the company’s long-term future. The firm, which hired Deloitte as administrators in April, said it will continue to operate with 218 stores and 2,200 employees after completing the restructuring.

Don’t let Covid-19 bust your business!

It will if your cash flow dries up, either sooner or later.

The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid since 1914. We have seen many financial crises, this one will be particularly deadly for suppliers for sometime to come.

CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. Above all tactfully, because maintenance of goodwill is paramount.

To meet the needs of creditors in the current crisis, we have designed a “critical care” package especially tailored for the situation.

  • The annual package costs start at very low rates
  • A minimum performance warranty is provided
  • Several complimentary services included

Clients instruct CPA on-line via their PC or phone, completely user-friendly. Your late paying customers are told to pay you direct (not to us).

A very recent report shows a 23% increase in the number of unpaid invoices since March 11th THIS YEAR – are you getting a build-up of late payers?

 Right now, overdue accounts must be a concern and CPA has a great track record of encouraging slow-payers to pay their suppliers quickly.

It takes less than 17 minutes to see how you would benefit, do you have the time now?

No face-to-face meeting required – just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email nsm@cpa.co.uk today.

When you see your money come in, you will be so glad you used CPA.

Do you sell on credit?

With pressures on the cash flow it is essential that you stay on top of the credit limits you grant customers and watch carefully for any late payments.

Those customers will look for the easiest option  to boost their cash-flow. Don’t let it be you.

You can’t just assume your customers can and will pay you eventually, no matter how big their name is.

It is essential to have credit management systems in place to monitor and check your customers credit worthiness.

It is also best practice to use a trusted third party like CPA to make sure you are paid on time by customers, no matter how good a name they have.

About CPA

The Credit Protection Association can help!

Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.

At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.

We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.

Companies in trouble usually have very bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.

If you supply on credit, help us help you identify the risks.

Why use a third party collector?

As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When your customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.

Over the years we have collected billions in overdue invoices for our customers.

Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.

You might be hesitant about contacting a debt collection agency. What are they going to be like?

Can they help your particular type of business?

There is no need for concern. CPA are courteous, helpful and very probably have had direct experience of working with your type of business.

Debt collection agencies are not all alike.

Success lies in both recovering money and keeping customers happy. The Credit Protection Association was founded in 1914 and  has helped tens of thousands of UK businesses to collect outstanding payments and reduce the risk of incurring bad debt. We believe that creditors deserve to be paid for the work or goods they have supplied but we fully understand the need to maintain
the best possible relationship with customers!

At The Credit Protection Association, we provide solutions, advice and back-up in all areas relating to the supply of services or goods on account. Client-members receive everything they need from a single source to reduce debtor days and write-offs.

The Credit Protection Association has helped has assisted tens of thousands of UK businesses with their credit control requirements, since the First World War.

We are polite, firm and efficient when it comes to recovering outstanding debt.

“We have used CPA for a number of years now. The website is easy to navigate around with lots of helpful reports. The staff are always at hand and very friendly. CPA has  helped us reduce our debt over the years and keep track of potential issues with our customers.”
~ CPA client in Buckinghamshire

“The service from CPA has proved to be everything that you said it would be. We have already seen a huge benefit. We have had a number of overdue accounts paid promptly and directly to us. It is also a huge weight off our mind to know that once we have passed an overdue payment over to you, you take care of everything whilst keeping us informed.
~ Credit Controller client in Warrington

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections


Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

CPA is passionate about late payment

The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.

We are extremely passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs with cash flow difficulties being the single biggest killer of Britain’s small businesses.

If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.

As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.

Under little used legislation, you are entitled to compensation for those late payments.

Now you can boost your own cash-flow.

CPA can help unearth the those hidden treasures.

We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.

Yes, CPA can help you boost your business cash-flow.

Don’t let your bankers control you, contact CPA today.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

Read our blog here on how to crack down on the late payment culture.

Read our blog here on how to give late payers the slap they need.

The “Why” of the late payment culture.

New PM should walk the walk and back small firms over late payments

Paying late is “crack cocaine” to big business.

Late payment culture risks “spiraling out of control”

visit our late payment compensation page

See our full blog and FAQ on late payment compensation

Do you realise you could be sitting on a fortune?

Late payments often result in a cash flow crunch and leave SMEs in need of a cash injection.

If you sold B2B on credit then there may be a hidden source of capital you can call on.

If you fancy an bit of extra cash in your business, rather than jumping through hoops with your bank, you could look to uncover the resources from an unexpected source within your own business.

Not many are aware but there could be a hidden fortune within your business, sitting there, just waiting to be uncovered and released.

We can help you uncover the pile of gold, you didn’t even know you were sitting on.

If you trade with other businesses and were often paid late then you could be entitled to significant compensation.

Under little known and under-utilised legislation your business could be due huge amounts in compensation that you didn’t even know about.

Let’s be clear – this is not a way to weaken any customer relationships you value. It is one that identifies who’s been paying late and then recover the potentially significant sums in compensation using Late Payment Legislation from businesses where the relationship has already ended.

You can pick and choose who you want us to follow up – but once we’ve agreed which companies you’d like to pursue compensation from it’s a fast process and there’s no financial outlay to you whatsoever. My team at CPA put its expertise to work to recover the compensation due and fight late payment culture.

That compensation could provide the cash boost your business needed.

But don’t delay, that compensation evaporates if not claimed within six years of the late payment.

How can CPA help?

CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.

We recognise that most companies do not have the resources to spend time on the identification and calculation of Late Payment Compensation. Our service can produce an Analyses within just a few days with (usually) less than 30 mins of co-operation from our clients. We work directly with over 300 accounting packages but can also work with bespoke accounts packages. Indeed, speed is essential as the oldest invoices may fall foul of the 6-year time limit.

Once the Sales Ledger Analyses is made available to clients, all that is required is that management decide which commercially sensitive ex-customers to remove from the list and return it to us.

CPA then uses its years of collection experience to explain and recover the Late Payment Compensation Claims. Clients do not handle any part of the recovery process as our team will take all communications from the companies against who the claims has been made. Often, it’s simply a case of explaining the legislation, sometimes we have to go all the way and enforce the legislation through the courts.

The result is that we are realising clients’ claims worth tens and sometimes hundreds of thousands of pounds which, of course, is pure net profit.  You may also be among the recipients of “hundreds of thousands of pounds” should you elect to take advantage of our services.

We do the work, you receive the cash.

If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.

We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.

We are helping business owners  who are looking to boost the returns from their business before they retire. We are helping businesses who have lost major clients after years of loyal service to get properly compensated for systematic late payment. We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.

Those former clients who regularly paid you late can finally be made to pay.

Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

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See all our latest news here!

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Read our blog here on how to crack down on the late payment culture.

Read our blog here on how to give late payers the slap they need.

25 excuses for late payment and how to get around them.

Read our Cash Flow Advice

Read about our overdue account recovery service

Read our blog – What is credit management?

Read our blog – How to select a debt collection agency

20 ways to avoid identity theft

see our blog – 15 steps to avoid invoice fraud

Overcoming 5 common reasons for disputed invoices

As insolvencies rise, could you spot these warning signs in your customers?

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections