- Quarterly Federation of Small Businesses (FSB) Small Business Index (SBI) shows confidence at second lowest ebb in report’s ten-year history.
- One in five firms reduced headcounts in three months to December; one in seven expect to do so this quarter.
- Share expecting profits to fall over next three months hits all-time high, with exporters feeling the strain as new EU-UK trade deal beds in.
The Federation of Small Businesses (FSB) has reported that 250,000 small firms are set to close this year under combined pressure from the coronavirus pandemic and Brexit.
The FSB survey revealed a “huge cost” ahead for employment without additional support from the Treasury to help mitigate the challenges faced by its members.
Its quarterly Small Business Index (SBI), which took in responses from 1,400 companies, found confidence at its second-lowest level since the financial crisis at a time the UK is facing the ongoing concerns of the Coronavirus pandemic.
Just under 5% of the 1,400 companies said they expect to close this year. This proportion is at an all-time high for the SBI, which launched in the wake of the financial crash, and is more than double that recorded at the same point 12 months ago.
23% of small firms surveyed have decreased the number of people they employ over the last three months, up from 13% at the beginning of last year, the survey found, while one in seven expect to slash employment in the current quarter to March.
Expectations for weaker profitability during 2021 reached an all-time high of 58% (up from 38%), it said.