Monthly Decision Maker Panel data - January 2021

The Decision Maker Panel (DMP) is a survey of Chief Financial Officers from small, medium and large UK businesses. We use it to monitor developments in the economy and to track businesses’ views.
Published on 04 February 2021

The January DMP survey was conducted between 8 and 22 January and received 2,706 responses. The January fieldwork was carried out following the announcement of a third national lockdown on 4 January.

In January, businesses estimated that their sales in 2021 Q1 would be 21% lower than they otherwise would have been because of Covid, with employment 8% lower and investment 23% lower.

Near-term sales expectations were revised down in January for 2021 Q1 and 2021 Q2, by 6 percentage points and 2 percentage points respectively. The impact of Covid on sales was expected to ease during 2021 from -21% in 2021 Q1 to -11% in 2021 Q2 and -6% in 2021 Q3. 

The estimated impact of Covid on employment in 2020 Q4 was unchanged at -8% in the latest survey.  It was expected to remain at -8% in 2021 Q1, before starting to diminish in Q2 and Q3 to -6% and -4% respectively, although these near-term employment expectations were around 1 percentage point lower than in the December survey.

The percentage of employees on full-time furlough (still employed but not required to work any hours) increased to 15% in January.

In January, businesses expected 2020 Q4 investment to be 24% lower than it would have been due to Covid, a 4 percentage point decline on December expectations. 2021 Q1 investment expectations were expected to remain at a similar level at -23%, with Covid impacts expected to soften in 2021 Q2 and 2021 Q3 to -14% and -10% respectively.

Overall uncertainty remained unchanged in January. The percentage of businesses that viewed overall economic uncertainty as high or very high fell marginally from 68% to 67% in January, and remained much higher than 41% at the start of the year. Covid remained the largest source of uncertainty for 50% of businesses, and in the top 3 sources for around 84%, similar to previous months.

There was a fall in Brexit uncertainty following the announcement of the UK-EU trade deal on 24 December. The percentage of businesses reporting that Brexit was in their top three sources of uncertainty fell from 46% in December to 43% in January. This fall was driven by businesses in the service sector. Firms in the goods sector, which may have been more affected by new customs rules and border disruption, saw no fall in uncertainty.

The announcement of the Brexit deal had little impact on the net balance of responses regarding the expected longer-term impact of Brexit on sales. 

The DMP was set up in August 2016 by the Bank of England together with academics from Stanford University and the University of Nottingham. It was designed to be representative of the population of UK businesses. All results are weighted. See Bloom et al (2017) Opens in a new window for more details.

The DMP receives funding from the Economic and Social Research Council.