Corona
CBS today publishes data on managers’ satisfaction with the assistance programs provided to businesses in the Corona crisis: guaranteed loans, deferral of debt repayments to banks, financing for employees in the IDF, distribution of grants, etc.
Faced with the current debate about the non-opening of government grants to businesses that may experience a decline due to the rapid spread of the Omicron strain, a new chapter is published today in the CBS ‘monthly trends survey of executives in the industry, construction, retail, hotels and services industries. The chapter was born as part of the CBS ‘cooperation with government ministries and the Bank of Israel, and thus was added to the survey questionnaire – which includes changing questions on economic policy issues – a chapter dealing with government assistance programs during the Corona.
During 2021-2020, the Israeli government implemented several assistance programs. These are designed to stabilize the economy and the labor market. In the survey, managers were asked to what extent these programs facilitated them:
- Distribution of state-guaranteed loans
- Deferral of debt repayment to banks
- Providing financing to employees who are in the IDF
- Distribution of grants for the return of workers from health care or the retention of workers
- Distribution of grants for a decrease in revenue.
The return percentage for this chapter is about 84% and the survey sample represents a population of about 60,000 businesses in the business sector with about 5 jobs or more. Here are the main data in front of you:
- 65% of the businesses in the survey population did not need to have their loans or debt repayments deferred by the banks. This type of support was the least used compared to the other types of support reviewed.
- The estimates show that in all the various support programs, the proportion of large businesses that did not need support is large compared to the small and medium-sized businesses, with the exception of the grant program for returning workers from the sick / retention of employees.
- According to the managers’ answers, it is clear that in the program of financing employees who go to the IDF, the highest use is made by the businesses. About 59% of the businesses were assisted by this program (and during the crisis some of their employees were taken out to the IDF due to the various restrictions).
- The second major program in which business executives have benefited is a revenue reduction grant. According to estimates, about 43% of businesses received this grant and about 12% applied but the grant was not approved.
- About 54% of the hotel businesses stated that the employee return grant helped them greatly, compared to only about 17% who indicated this in the general survey population. This is the only grant out of the five support programs reviewed that the proportion of large businesses assisted by it is higher than the proportion of small and medium-sized businesses.
- More than half of the businesses in the construction and information and communications industries did not need a revenue reduction grant, compared with 22% in the food and beverage services industry (restaurants and banquet halls).
expansion
Of the five different government subsidies presented to the reporters, it appears that the program for financing workers in the IDF is the most common. About 59% of businesses used it. If one examines the support programs according to the degree of their assistance according to the principals’ reports, it appears that the program that helped the most to overcome the crisis is the provision of state-guaranteed loans. About 63% of those who received this assistance indicated that it greatly helped them overcome the crisis.
About 54% of the businesses that used the expense of the IDF stated that the financing of employees in the IDF helped them to overcome the crisis to a great extent.
State-guaranteed loan
In most industries at least 49% of businesses reported that they did not need a state-guaranteed loan. The exceptional industries are hotels and hospitality and food services (restaurants) in which only about 13% and 23% of businesses, respectively, did not need this assistance. These industries were most affected by the corona crisis.
Previous findings from flash surveys conducted by the Central Bureau of Statistics and estimates in other countries show that large businesses were less affected by the crisis compared to small businesses and therefore needed less government support.
Deferral of loan repayments and debt arrangements with banks
About 26% of all businesses in the survey population received assistance in deferring loan repayments and debt settlements. In the hotel industry, about 56% of businesses received this assistance, and in the food and beverage services industry, about 42%.
Departure to Khalat
The main government support during the crisis was to finance workers who are in the IDF. In fact, the state has extended the payment of unemployment benefits also to workers who have stopped working temporarily due to the crisis.
Compared to the other types of assistance in the survey, more businesses needed government funding for their employees who went abroad. There were no businesses in the hotel industry that did not need this assistance, and in the food and beverage services industry the proportion of businesses that reported not needing it was only 13%.
About 41% of businesses in the total survey population did not need this support. The construction industry has the highest percentage of businesses that did not need this assistance and did not outsource their workers (about 56% of the businesses), and indeed this industry was exceeded by most of the restrictions throughout the crisis.