The March DMP survey was conducted between 5 and 19 March and received 3,116 responses.
In March, businesses estimated that their sales in 2021 Q1 would be 20% lower than they otherwise would have been because of Covid-19, with employment 9% lower and investment 21% lower.
Near-term sales expectations were unchanged in March for 2021 Q2 and 2021 Q3, for the second month in a row, but longer-term sales expectations declined slightly. The impact of Covid-19 on sales was expected to ease during 2021 from -20% in 2021 Q1 to -11% in 2021 Q2,-6% in 2021 Q3 and -1% in 2022 and beyond.
In March, the estimated impact of Covid-19 on employment was less negative than in the February survey. Businesses’ expectations on the near-term impact of Covid-19 on employment in 2021 Q1 and Q2 improved by 1 percentage point to -9% and -7% respectively, with expectations for 2021 Q3 and 2022 and beyond improving by 2 percentage points to -4% and -1% respectively.
The percentage of employees on full-time furlough (still employed but not required to work any hours) remained broadly stable at 14% in March.
In March, businesses expected 2021 Q1 investment to be 21% lower than it would have been due to Covid-19, a 1 percentage point improvement on February expectations. Investment expectations for 2021 Q2 and Q3 improved more substantially to -12% and -4% respectively, up 5 and 7 percentage points respectively on February expectations. Longer-term expectations for 2022 and beyond were positive for the first time, with firms expecting investment to be around 2% higher than in the absence of Covid-19.
Overall uncertainty continued to fall in March. The percentage of businesses that viewed overall economic uncertainty as high or very high fell from 67% in January and 58% in February to 57% in March, the lowest level since February 2020. Covid-19 remained the largest source of uncertainty for 40% of businesses, and in the top 3 sources for around 74%, down from 47% and 82% respectively in February.
Brexit related uncertainty also fell in March, with 41% of businesses reporting that Brexit was in their top three sources of uncertainty, down from 43% in February. The share of firms which reported Brexit as their largest source of uncertainty remained unchanged at 4%.