A Federation of Small Businesses (FSB) survey suggests most small firms are currently operating below capacity amid a cost-of-doing-business crisis.
The FSB said its latest Small Business Index painted a mixed picture across industries. The headline confidence reading stood at +15.3, meaning more firms expect an improvement in performance than the opposite. The headline rate though masks an uneven distribution by sector, with confidence among accommodation and food, and information and communication firms much stronger than manufacturing, wholesale and retail businesses.
In addition, a record 87% of respondents reported higher operating costs compared to this time last year, with the shares citing fuel, utilities and taxation as contributors to that increase each at all-time highs. The survey also found that 55% of business owners feel they are operating below capacity.
FSB National Chair Martin McTague said, “It’s encouraging to see small business confidence back in positive territory, though the picture across sectors is distinctly mixed. The small business community shrank in size to the tune of hundreds of thousands over the pandemic. This needs to be the summer where we start to reverse that trend – policymakers should be doing all they can to facilitate and encourage start-ups and side hustles.”