72% CEOs say paid leaves are inappropriate during lockdown

The survey titled as ‘Impact of Covid-19 on People and Industries’ conducted from 29 March to 29 April covered more than 500 companies across India and cross-section of industries such as IT and ITES product services (45%), manufacturing and capital intensive and allied industries (40%), modern retail/online and other businesses (15%).

Out of 270 Companies, 159 companies implemented a complete work-from-home immediately and 57 companies managed 70% of its operations remotely. About 57 companies were able to execute less than 50% work-from-home, which resulted in adding stress on business continuity due to reduced revenues.

For 54% of the participating companies, work-from-home seemed a possibility though some faced challenges of productivity due to connectivity issues and for smaller firms data security was one of the major concerns.

During the survey, the business owners came up with a suggestion that the government should pay employees Provident Fund (PF) and Employees' State Insurance (ESI) for March, April and May. And also provide support to the industries by providing rebates in taxes, reduce interest percentage, provide employees welfare activities, and make sure utilities are available at controlled costs.

In addition, the business owners suggested that the government should pay 50% of the employee cost for MSME with turnover of less than 50 crores for shutdown period and 25% for a period of three to six months post shutdown till business conditions improve.

A deposit of Rs 15 lakhs to each family as promised by PM earlier or some amount of it to combat the next six months, and release of some sort of  unemployment allowance, especially for those who are jobless and who were earning less than Rs 15,000 per month, were some additional suggestions. They also mentioned that smaller companies need ease of access to loans from banks and non-banking financial companies to rebuild their businesses.

SMEs when asked whom they approached for advice in crisis, 55% accounted for help from well-wishers coupled with their own decision making, and 29% opted for specialist advisory. While, the government advisory opted by SMEs accounted for just less than 12%.

The survey added that the lockdown impacted especially the Startups and SMEs in India with a 60% to 90% impact on 350 companies on day one itself. In the case of 110 companies with more than 500 people, the pandemic had a 100% impact.

The highly affected industries included aviation, hotel restaurant and tourism, auto dealerships, ceramic tiles, gems and jewellery, retail, shipping, ports and port services, seafood and poultry and microfinance institutions.