The latest Federation of Small Businesses Small Business Index (SBI) offers glimmers of hope for small businesses across Yorkshire, the Humber & the North East. The tracker survey shows business confidence, whilst still negative overall, has risen sharply from -58 in Q4 2022 to -16 in Q1 2023.
There is less good news on employment with the number of small businesses in the area taking on new staff (5%) lower than those who are losing staff (14%). Looking ahead however, staffing levels could rise, with 11% of business owners looking to increase and 10% expecting to decrease their headcount. The survey also indicates that investment intentions for Yorkshire, the Humber & North East businesses are the lowest in the UK.
The main issue identified as holding small business back is the overall poor economic conditions. Specifically, high energy prices and the tax burden on small businesses are seen as the biggest barriers to success.
Mohammed Hussain, FSB Policy Representative for the Region, said, “It is good to see business confidence moving in the right direction after all the challenges thrown at us over the last few years. This less negative mood is certainly reflected in the many conversations I have with local business owners.
“Our research provides a glimmer of hope that things are looking up. We should never underestimate or take for granted the incredible grit and determination small business owners have had to have. Their can-do attitude has been key to getting us all through the challenge of recent years and will be crucial to get the economy back on track.
“Although this confidence is fragile, we are moving away from the record low position our last survey found. We are seeing many reasons for optimism to rise and businesses in our region planning for future growth and success.
“Although the figures overall are going in the right direction, we mustn’t overlook that fact that this can mask individual stories. There is a number of firms exposed to high prices in fixed-rate contracts from last year unable to negotiate a new contract. High inflation is making some businesses extremely vulnerable. We are also seeing certain sectors, for example the hospitality sector, facing bigger challenges than others.
“This is why the FSB has consistently argued for targeted support. We want the small businesses who face the biggest problems through no fault of their own to get the help their need.”