The South West’s small firms are the least confident in the UK about their prospects for this year as they continue to struggle against the state of the economy, high labour costs and the lack of available staff.
Worryingly, one in five say they may have to cut their workforce to stay in business throughout 2024, according to the latest quarterly survey by the FSB (Federation of Small Businesses).
Its policy representative in the South West called on politicians of all parties to address the urgent needs of small firms as they draw up their policies for the next general election.
The survey, which provides a snapshot of the views of the region’s small firms during the final three months of 2023, reveals that two-thirds of the region’s small firms think the general state of the economy will be the biggest barrier to growth this year.
It also shows overall optimism in the region continued to fall – down from minus-31% to minus-37% – putting the South West behind every other part of the UK.
The FSB said the only real consolation was that the South West’s figures were well ahead of this time last year – when regional confidence hit a record low.
However, the general tone of the survey results was described as “worrying” by the FSB’s regional chief.
South West policy representative Craig Carey-Clinch, pictured above, said: “These figures paint a depressingly familiar picture. The reality is when confidence is low it affects every aspect of business thinking.
“When businesses lack confidence they take less risks, are less inclined to take staff on and can put growth plans firmly on hold.
“And none of that is good for the economy as a whole. It is a worrying report.”
He said as the country had now entered a probable election year, it was vital all politicians took note of what was happening in the small business arena and to put it at the heart of their economic agendas.
“Last year ended on a downbeat note for far too many of our great South West businesses,” he added.
“Let us now hope that picture changes quickly and 2024 can see the ‘bounce back’ we all want to see.”
