Industry bodies warn on carnage in print

Jo Francis
Friday, September 25, 2020

Chancellor Rishi Sunak has been warned that thousands of print businesses could go bust if the government doesn’t bring in targeted relief for the industry.

Sunak with a printed copy of his Winter Economy Plan
Sunak with a printed copy of his Winter Economy Plan

The Graphics & Print Media Alliance (GPMA), which incorporates 15 organisations including the BPIF, IPIA, Picon, PPMA, Packaging Federation and The Printing Charity has written to Sunak to detail concerns that 3,000 print businesses – more than a third of the industry total – will not survive a prolonged period of Covid-19 related restrictions.

The joint letter stated: “We are keen that the efforts that have been made by your Departments to prevent job and business losses, are not undone.

“Our particular concern is for the printing industry and its future, the maintenance and integrity of its supply chains, and the threat to thousands of businesses and tens of thousands of jobs that this pandemic continues to pose.”

The GPMA acknowledged that not all printing industry businesses had been hit, and called for a means-tested “disaster relief style grant” that could be made available to print firms and other companies that face a similar scenario.

The letter pointed out that, unlike some other sectors, the lost business in print was just that – lost – as opposed to delayed.

“Individual consumers may delay purchasing decisions for cars, home entertainment systems and so on until the economic situation is improved. We can expect a surge in demand for these items when it seems the crisis is coming to an end.

“Print, however, is largely bought on a weekly and monthly basis as needs require – in other words, little and often. At best, order levels will return to where they were prior to the crisis, however it will not be possible for the industry to service all the debt which will have built up due to the need to remain solvent.”

The GPMA warned of stark outcomes for the sector and stated that if restrictions remained in place until the year-end, and without any additional government support, around 3,000 companies would need to declare insolvency; while a further 3,000 would only be able to keep going for another six months.

The letter also stated that less than 10% of firms were in a position to take out further government-backed loans.

The GPMA said that the remaining print firms would be likely to make redundancies.

Prior to the pandemic, the UK printing industry employed around 112,000 people across 8,000 businesses, according to stats from the BPIF.

The letter noted that already low demand was being exacerbated by the ‘Rule of Six’, and this week’s new measures imposed on the retail, leisure, entertainment and hospitality industries “would also have a knock-on effect on those industries’ need for printed materials”.

Download the full letter here.

In Printweek’s current industry poll, nearly 74% of respondents (at the time of writing) said the government should bring in targeted reliefs for the sectors worst-affected by the pandemic.

 

Separately, Unite the Union general secretary Len McCluskey called for more to be done to avoid mass unemployment.

He said he feared the measures announced by Sunak in yesterday’s Winter Economy Plan “may come too late for far too many” and had left gaps “that could see millions more facing poverty and joblessness in the coming weeks”.

"We have seen a summer of jobs destruction but an absence of jobs creation. We urge the government to work with us as we put our collective shoulders to the wheel in the task of recovering the economy, because the spectre of mass unemployment still stalks our communities,” McCluskey stated.

“Industries teetering on the cliff edge like aviation, retail and hospitality, where jobs are being lost hand over fist and where the impact of this crisis continues to be devastating, will need further support.”

During yesterday’s statement in Parliament Sunak spoke about the end of the Job Retention Scheme and said it was “fundamentally wrong” to hold people in jobs that only existed inside the furlough.

“We need to create new opportunities and allow the economy to move forward and that means supporting people to be in viable jobs which provide genuine security,” he stated.

“As I’ve said throughout this crisis, I cannot save every business. I cannot save every job. No chancellor could. But what we can and must do is deal with the real problems businesses and employees are facing now.”

Earlier this year Sunak was pictured wrangling with some promotional self-cling as part of the push around his Eat Out to Help Out scheme. 

 

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