Small business owners based in London have reported a dramatic drop in confidence over the past three months, but 55 percent still plan to invest in their business in the next 12 months.
Small business confidence entered “reverse gear” during the second quarter of 2022, according to the latest London Small Business Index (LSBI) by the Federation of Small Businesses (FSB).
In the first quarter of the year, the LSBI’s confidence level stood at +43, but fell to -14 during the second quarter.
68 percent of business owners surveyed attributed their negative outlook to general economic conditions in the UK. 32 per cent said their pessimism was due to a lack of appropriately skilled workforce, while 25 per cent attributed the slowdown in consumer demand and 29 per cent said foreign economies were the biggest impediments to growth in the coming 12 months.
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However, more than half (55 percent) of all businesses said they plan to grow either rapidly or moderately in the coming year, while 25 percent expect to increase investment in their business over the next three months. Huh.
Rowena Howie, FSB London Policy Chair, said this highlights the need for more small business funding.
“The London Small Business Index has moved into reverse gear in the last quarter, and it is clear that external factors are playing a big part in this negative sentiment,” Howie said.
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“The cost of doing business in London is rising from every angle. From the cost of materials to the price of filling a tank to paying the high energy bills – and that was before we even increased the cost of commercial space and the employment tax. Huh.
“Firms are in dire need of help with the charges against them regardless of profits: those linked to trade rates, national insurance, utilities, fuel and supply chain disruptions.
“In this time of economic and political turmoil, we are looking for prime ministerial candidates with clearly pro-business, pro-development commitments. There is still time to act, but time is of the essence.”
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