Business confidence in Lancashire plummets, new FSB economic survey says

Paul Wareham from the Federation of Small Businesses

The quarterly Small Business Index – which measures business confidence – showed clearly the negative sentiment felt by business owners across the region, falling from +3 per cent in Q1 of 2022 to -27 per cent in Q2, slightly below the national average (-24.7 per cent).

With the exception of the dramatic decline throughout the pandemic, these figures show business confidence in the region is at its lowest since the quarterly survey began.

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The FSB said the challenging economic environment against a backdrop of surging operating costs, a high tax burden, and a significant labour shortage is devastating the small business community, threatening the futures of hundreds of thousands of small firms and sole traders.

The report also showed that 63 per cent of small businesses expected the wages they pay to increase in the next 12 months, but this figure is starting to slow, in the previous quarter 74 per cent expected wages to rise. This could be indicative of affordability.

And 44 per cent of businesses reported falling revenue, with 36 per cent saying that income had increased.

38 per cent expect revenue to fall again in the near future.

While 50 per cent of small business respondents aspire to grow in the coming year, 25 per cent expect a fall in investment in their businesses, suggesting that those aspirations may need to take a back-seat for now.

Paul Wareham, FSB North West England Policy Representative, said: “Small Businesses have reported a tough second quarter of 2022 as multiple issues dampen the ambition shown in the first quarter of this year.

“Confidence amongst small businesses in the North West has plummeted.

“The optimism felt at the turn of the year has disappeared for many small businesses who are seeing rising costs across the board, with recruitment difficulties and supply chain complications also causing headaches.”

“FSB continues to make the case for extra support to small businesses to get them through a difficult period.

“The lack of business confidence makes business planning and investment very difficult for the smallest firms and we need to see this turnaround quickly.”

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