Small business confidence in the South West has dropped

Wednesday, 28 August 2024 05:55

Small business confidence in the South West has dropped again this quarter after staging a positive surge earlier in the year.

The Federation of Small Businesses (FSB)’s first regional quarterly report for 2024 saw confidence levels amongst local business owners rise to their highest levels for over two years but the latest figures have seen a sharp decline in regional positivity by 30 percentage points.

The survey – carried out just before and after the General Election – revealed that more South West business owners had decreased their staff numbers rather than increased them and showed that two thirds of respondents regarded current economic conditions as their biggest barrier to future growth. Consumer demand and labour costs also scored highly amongst the concerns of those surveyed.

The FSB report did, however, reveal some more encouraging news from the region’s business owners. Employment trends in the next quarter looked more positive, more than half of those surveyed said they aimed to grow either rapidly or moderately in the next quarter and regional investment ambitions are well above the national average.

FSB’s South West Chair Lee Nathan said the report overall was a ‘mixed bag’ – but the headline confidence figures were a genuine frustration.

“There were some positive signs in the report this time, but the big disappointment is the overall headline confidence figures. We all hoped the surge last quarter was an indication that a corner may have been turned but the fact that confidence has slipped back should be a timely reminder to the new Government that the small business community is looking to them to help improve the general economic outlook,” he said.

The South West regional report was released a part of the national FSB report which also showed a major UK-wide downturn in economic confidence amongst small business owners. Reflecting on the ‘disheartening’ figures FSB’s Policy Chair Tina McKenzie said she hoped the situation could be turned around again.

“The fall in confidence amongst small firms is disheartening, but need not become a self-fulfilling prophecy. With the right support, we know that small businesses can thrive and drive the economic growth that the Government has said is its priority.

“The small business community is looking for reassurance from the Government that it is listening to their concerns, especially around tax and employment.”