Retailers in York can look to re-open and rescue vital festive trade - but the survival of many businesses in the city is now 'hanging by a thread'.

The tougher Tier 2 restrictions for York impact heavily on hospitality, which remains frozen, with the knock-on effect for supply chains also expected to hit hard.

And with York and North Yorkshire neighbouring many Tier 3 areas, customers levels will be lower than normal for this time of year, meaning many businesses will still be struggling to break even.

Phil Pinder, head of York Retail Forum, said: "With both of our MPs pushing for Tier one, it's disappointing we haven't been put into Tier one at least for this first period.

"Had cases gone back up again we could have gone back up to Tier 2 at the next review in two weeks time.

"Now is really a crucial time for retail and hospitality. It's the time of year when pubs, restaurants and shops really do pretty much double to triple turnover what they would do in a quiet month like January or February.

"It is welcome that retail shops can reopen. We knew that would happen whatever tier we went into.

"Our concern is for the hospitality businesses as we head into Tier 2. The problem with them being closed or with restricted openings does affect retail. The last time we were in Tier 2, retail businesses were trading down minus 40 per cent on last year and I have got real worries that many businesses won't make it through to Easter."

Andrew Digwood, partner and Rollits law firm in York, and president of the York & North Yorkshire Chamber of Commerce, said it was always going to be a difficult call.

"A Tier one rating would have reflected the great work that businesses and residents in York have done in driving down the spread of the virus and would have been such a boost to our hospitality, leisure and retail sectors in the run-up to Christmas.

"However, it’s difficult to imagine how business owners and their staff could have been expected to deal with incoming visitors/customers from higher tier surrounding areas where the infection rates were so much higher, and this could have posed its own risks to many of those businesses in the medium term.

"Tier 2, and in particular the restrictions on household mixing indoors, will be a massive blow to those sectors and so the Chamber continues to call for review of the targeted financial support mechanisms offered to businesses who are particularly affected by these restrictions, including businesses in their supply chains.

"We see it as absolutely essential that the support available is commensurate with the level of restrictions imposed and that there is a clear and transparent mechanism both for accessing that support and for understanding at what point we might be able to move out of Tier 2, especially given the progress that has already been made in York."

Carolyn Frank, development manager North Yorkshire of the Federation of Small Businesses, said: "These have been trying and difficult times for so many, and with the festive season upon us it’s never been more important to see trading resume once again for retail and hospitality in particular, and their suppliers.

"Many public-facing small businesses in York and North Yorkshire will be breathing a sigh of relief that they can open and operate in tier two, in what is the busiest month of the year for many.

"However, the challenges are still there for many others, such as pubs who don’t serve food and cannot welcome their customers back just yet or the whole wedding industry who are still severely restricted.

"Also with many tier 3 areas surrounding us, customers levels will still be far lower than normal for the time of year in our area so many businesses will still be struggling to break even.

"Of course there are also still gaps in support for those affected by the pandemic and to protect jobs we must protect businesses including the newly self-employed.

"Support needs to be balanced against the new restrictions and widened to more sectors who are still missing out.

"We were expecting this, and small businesses that have gone above and beyond throughout the pandemic to protect customers, spending huge sums of money to make their venues Covid-secure, will of course comply with the restrictions, but today’s news will be disappointing for them after all the work to reduce transmission.

"We can only hope that the review in two weeks’ time will see enough progress to allow for a move down the tier system so we can see tier 1 for Christmas, as locally our figures have a downward trend. I encourage everyone to do all they can to support our amazing local firms as much as they can over the coming weeks within the restrictions."

Beckie Hart, director of the CBI Yorkshire & Humber which speaks up for businesses of all sizes and sectors, said: “For many businesses in Yorkshire and Humber, going into toughened tiers while waiting for a vaccine will feel like suspended animation.

“Some parts of the economy, such as retail, can begin to re-open and look towards a recovery. It gives our high streets a chance to rescue some of the vital festive trading period.

“But for other businesses the ongoing restrictions in tiers 2 and 3 will leave their survival hanging by a thread. Hospitality will remain frozen. And supply chains that cross regions in different tiers will be hit even if they don’t face direct restrictions.

“It’s vital that these firms receive the financial support they need to make it through to the Spring. Clarity about ongoing employment support, including the Job Retention Bonus, will help protect as many jobs as possible. Businesses need to know what support will be there through to March and beyond in advance, rather than taking it down to the wire.

“Lessons must be learned from previous local lockdowns. Boundary lines between different tiers need to work on the ground. Trigger points for exiting the higher tiers must be transparent.

“Those decisions will need to be clearly communicated each fortnight and taken collaboratively between local, regional and national leaders. Most importantly, evidence must be open and transparent – the cost to jobs is only justifiable if it has a material impact on health.

“Liverpool’s shift to tier 2 is clear evidence that mass testing can make a real difference on the ground.

“So there is encouraging news on mass rapid testing and vaccines, and it’s vital to protect jobs and businesses with an end in sight.”