The Federation of Small Businesses (FSB) has set out a series of measures to help boost growth after survey evidence found confidence among small firms at a record low, outside periods of lockdown.
Data from the latest FSB Small Business Index shows small firms’ confidence is currently languishing near the depths recorded during the second COVID lockdown. The headline confidence figure fell to -46 points in the final quarter of 2022, down from -36 points in the previous quarter and the lowest level since Q4 2020, when it dropped to -49 points.
The FSB described the results as ‘incredibly worrying’ and called on the government to implement a range of measures to boost growth. These include tackling late payment, addressing recruitment issues, driving energy efficiency, powering research and development (R&D) and reforming the way taxes are levied. FSB National Chair Martin McTague commented, “Clearly, falling consumer spending, inflation and high energy bills are
all taking a toll, and poor results after the golden quarter are particularly disappointing – but this should also be a time to grasp the nettle and be decisive in finding more ways for the economy to grow, which is why we have drawn up a plan of action for the government to implement.”
The government recently launched a consultation seeking views on the introduction of a single R&D tax relief scheme designed to simplify the system and help grow the economy.
This consultation sets out details of a proposed new scheme that would merge the existing Research and Development Expenditure Credit (RDEC) and small and medium enterprises (SME) R&D relief schemes. The eight-week consultation period is due to run until 13 March 2023.
The government said it recognises the important role tax reliefs play in encouraging businesses to invest in R&D, helping them to grow and create the technologies, products and services which reshape lives and livelihoods. It hopes the new scheme will provide smaller company decision makers with clearer information about how much relief they will receive and thereby help them set budgets for R&D.
Commenting on the consultation, Financial Secretary to the Treasury Victoria Atkins MP said, “Getting R&D tax relief right and fit for the future sits at the heart of making sure the UK remains a competitive location for cutting edge research – helping new firms grow. I welcome views on the option to simplify the scheme, especially from those who have experience of the existing tax reliefs.”
New research shows there has been a significant rise in the number of older people re-joining the UK workforce during the course of the last 12 months.
According to analysis conducted by human resource development specialists Wilford Scholes, the number of
pensioners in full-time employment rose by 75,000 in 2022. This represents a sevenfold net increase in the number of employees over 65 compared to the previous year.
The cost-of-living crisis and its impact on people’s retirement plans is believed to be the key driver behind this surge in ‘silver workers.’ With soaring energy and food bills increasingly denting household budgets, a notable minority of people aged over 65 seem to be deciding to reenter the jobs market in order to make their pensions go further and last longer.
Data from recruitment agency Randstad UK has also highlighted this trend, with a significant rise in those aged over 60 registering as job candidates; the recruiter said the number of candidates over 60 applying to the agency was around 160% higher than its long-term annual average level. Randstad also puts the rise down to
soaring living costs which are hitting early retirees hard in the pocket.
The government has announced that its Start Up Loans programme has achieved another notable milestone with the 100,000th business loan recently having been granted.
Start Up Loans are government-backed personal loans available to individuals looking to start or grow a business in the UK. The scheme is administered by the British Business Bank and, as well as providing financial support, also offers guidance and advice to entrepreneurs looking to start their own business.
The loans have had a significant impact throughout the UK, helping to establish a wide range of new businesses right across the country. The top five local authorities by loan volume and value are Birmingham, Leeds, Cornwall, Hackney and Manchester, while the 100,000th recipient was St Albans-based noodle shop Ramen Electra. Business Minister Kevin Hollinrake said, “We know how important small businesses are to our communities, creating jobs, growth and opportunities. As a former business owner, I know how difficult it can be to get your business off the ground, which is why I’m incredibly proud that governmentbacked Start Up loans have helped 100,000 aspiring entrepreneurs, from Shetland to Shoreditch, to make their dreams a reality.”
A recent study suggests employers are increasingly recognising the strong business case for introducing health and wellbeing policies that support their staff.
According to the survey of 352 business leaders conducted by health insurer Vitality and the CBI, employee wellbeing is now viewed as a top priority by almost two-thirds of organisations, with only business performance and staff retention scoring more highly on this measure. Furthermore, nearly seven out of ten
businesses that have introduced health and wellbeing support reported an increase in employee productivity.
Over half of respondents, however, did say that tailoring support to the needs of different people within their organisation was a challenge. In addition, more than a quarter said they did not currently measure health and wellbeing within the workplace; and the report’s authors suggested this lack of data could make it
difficult for employers to understand how to support staff.
The study also found that just over half of all surveyed businesses felt hybrid working is the most supportive
environment for productivity. In total, four out of ten respondents said their business had introduced a formal hybrid working policy since the pandemic, while seven in ten had given employees greater flexibility to work in a way that supports their wellbeing.
NECESSITY ENTREPRENEURS
Research commissioned by GoDaddy has found that almost half of all British adults are considering launching a side hustle this year, with the vast majority of these would-be entrepreneurs doing so to combat rising bills. These findings suggest the cost-of-living squeeze could be set to unleash a swathe of ‘necessity entrepreneurs’ who start their own venture as a way of making ends meet.
CONCERNS RAISED OVER COMMUTING IN THE DARK
A new survey undertaken by payroll specialists Remote has found that almost nine out of ten women feel firms
should offer greater flexibility in working arrangements in order to enable them to commute in daylight hours during the winter months. In total, nearly half of all respondents said they felt uneasy commuting in the dark, while four out of ten felt vulnerable and a third unsafe.
JOB SCAMS ALERT
Employers are being warned about a rise in the number of job scams and the impact this could have on their recruitment plans. January’s data shows a large increase in reporting of scams compared to the previous month, including WhatsApp and Facebook messages offering highly paid jobs and out-of-the-blue employment opportunities. It is feared these fake adverts could dilute the impact of real adverts creating problems for legitimate employers.
Last month, Chancellor of the Exchequer Jeremy Hunt set out his long-term vision for the UK economy in a speech delivered at Bloomberg’s UK headquarters in the City of London.
The Chancellor warned that the UK must not succumb to “declinism” and said his priorities included halving inflation, lowering national debt and growing the UK economy. Some of the key points outlined during his speech were:
While business groups did welcome the sentiments expressed in the Chancellor’s speech, they also voiced concerns that his growth plan was noticeably short on detail:
“The Chancellor is right to be optimistic for the future of British businesses which are desperate to grow and prosper. But beyond pledges to introduce Investment Zones and to use reform of Solvency II to unlock capital there was very little meat on the bones of the Chancellor’s vision.” Shevaun Haviland, British Chambers of Commerce Director General.
“There is much to get behind here with the Chancellor’s emphasis on using innovation as the foundation of the UK’s future economy. He now has a strong framework for growth. And we hope the Budget will show strong
actions to move us forward.” Tony Danker, Director-General of the Confederation of British Industry.
“The Chancellor himself said his speech was “not a series of measures or announcements”. We would therefore add a fifth E for ‘Empty’ to his 4 E’s economic framework.”
Kitty Ussher, Institute of Director’s Chief Economist.