HYDERABAD: It will take a year to recover from the impact of Covid-19 on the industry, opined majority CEOs in a survey conducted by the Confederation of Indian Industry (CII). The snap poll was conducted on May 1 with 300 CEOs, of whom two-thirds belonged to MSMEs.
According to the CII CEOs snap poll on impact of Covid-19 on the economy and industry, heads of 54 per cent firms foresee job losses in their respective sectors after the lockdown ends. A major share of respondents (45 per cent) expects 15-30 per cent job cuts. However, allaying concerns, nearly two-thirds of the respondents reported that they have not seen wage cuts in their firms so far.
A majority of the firms continue to anticipate a significant decline in their topline; they foresee a delay in economic revival and demand recovery. The survey indicated that the lockdown brought economic activity to a grinding halt. The survey findings indicate that a significant majority of the firms (65 per cent) expect revenues to fall more than 40 per cent in the current quarter (April-June 2020).
For FY21, the expectations of a fall in revenue are staggered, with 33 per cent of the firms anticipating revenue loss of more than 40 per cent, closely followed by 32 per cent of firms expecting a revenue contraction ranging from 20-40 per cent.
While three out of four firms have identified that a ‘complete shutdown of operations’ was a major constraint being faced by business, more than half of them have also indicated ‘lack of demand for products’ as a hindrance to business activity.
CEOs saw a protracted slowdown in economic activity as a major proportion of the respondents (45 per cent) feel it would take more than a year to achieve economic normalcy once the lockdown ends.
A major proportion of the respondents anticipate normalcy in domestic demand conditions within 6-12 months, post lockdown. Additionally, it is pertinent to note that according to a large proportion of the firms, a recovery in domestic demand for their products and services may precede the recovery in foreign demand for the same.