Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

Rising wage costs dampen small business confidence, FSB survey reveals

by August 27, 2024
August 27, 2024
Rising wage costs dampen small business confidence, FSB survey reveals

Rising employment costs have significantly eroded confidence among the UK’s smallest businesses, according to the latest research from the Federation of Small Businesses (FSB).

The FSB’s Small Business Index revealed that confidence fell sharply into negative territory during the second quarter of the year, with soaring wages cited as the primary driver of this decline.

The index, which surveys over 1,000 small businesses, recorded a confidence score of -10.8 for the three months ending in June, a substantial drop of 16.3 points from the previous quarter. This downturn highlights the growing financial strain on small business owners, who are grappling with the highest employment costs on record. The survey also identified weaker consumer demand and rising tax pressures as additional barriers to growth.

Tina McKenzie, the FSB’s policy chair, expressed concern over the impact of rising labour costs, warning that ‘they could stifle economic growth and lead to a reduction in small business job numbers’. She also voiced apprehension about the ‘government’s upcoming employment law changes’, which she fears could increase the risks and costs associated with hiring staff for small businesses.

Labour’s proposed overhaul of workers’ rights could further exacerbate these challenges, potentially adding to the financial burden on employers. McKenzie called on the government to index the employment allowance to the rising living wage as a measure to alleviate the pressure on small firms and address the ongoing economic inactivity crisis. She emphasised the need for a thorough review of all government employment policies to ensure they do not negatively impact growth and jobs.

The FSB’s report also highlighted sector-specific struggles, with the construction industry emerging as the least optimistic, recording a confidence score of -20.7. The wholesale and retail sector followed closely with a score of -19.5, a significant decline from its previous positive outlook. The accommodation and food services sector also saw a drop in confidence, sliding to -15.9 points from -11.8 in the prior quarter.

Manufacturing, which had been the most optimistic sector in the first quarter with a positive score of 19.2, experienced the most dramatic decline, plunging to -12.7 in the second quarter. Meanwhile, the information and communication sector saw its confidence fall to -9.2 points, and the professional, scientific, and technical sector dropped to -2.6 points, making it the least negative among the major sectors.

McKenzie underscored the need for more targeted support, particularly for the struggling construction sector, where confidence has hit a new low. She advocated for reforms, including changes to the consumer infrastructure levy, to help small building firms secure the financing necessary to sustain their operations.

Read more:
Rising wage costs dampen small business confidence, FSB survey reveals

0
FacebookTwitterGoogle +Pinterest
previous post
Iceland boss warns Labour of potential bankruptcy from ‘shock’ minimum wage rise
next post
Radical land tax proposal gains traction with support from across the political spectrum

You may also like

UK retailers call on government to end China’s...

February 6, 2025

Four new directors for Bank of England board

August 11, 2022

Marks & Spencer set to open 20 new...

January 16, 2023

Getting to Know you: Adrian Buttress, MD, PermaGroup

July 19, 2024

Covid inquiry to hear Michelle Mone – linked...

February 27, 2025

Rolls-Royce’s 1970s rescue offers a blueprint for British...

April 17, 2025

Business Leaders Looking for More Innovation According to...

May 23, 2023

Triple lock means state pension set to rise...

September 12, 2023

Government Borrowing Rises to £8.4 Billion in February

March 21, 2024

Longest-ever wait for payment for SMEs in retail...

April 11, 2023

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Maybe Most People Do Not Want Teacher-Led Public School Prayer—But They Do Want Chaplains

      June 27, 2025
    • Flashback: The debate night against Trump that threw Biden’s reelection campaign into a free fall

      June 27, 2025
    • How to Improve your Trading Odds and Increase Opportunities

      June 27, 2025
    • UK Export Finance unveils new tools to boost SME global trade

      June 27, 2025
    • Republicans raise alarm over US vulnerability to mass drone strikes after Israel-Iran conflict

      June 27, 2025
    • Manchester businessman cleared of hacking charges in ICO case

      June 27, 2025

    Categories

    • Business (8,329)
    • Investing (2,075)
    • Politics (15,826)
    • Stocks (3,173)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved