Confidence among small business owners in the South West has fallen again according to the latest quarterly update from Britain’s biggest business representation group, the Federation of Small Businesses (FSB).
The national survey, which was carried out at the end of December before the latest lockdown restrictions started, revealed the second lowest confidence figures in the ten-year history of the FSB report. The only figures that were worse were recorded during the first major lockdown in the spring of 2020.
The survey revealed that around five percent of the firms questioned across the UK say they expect to close this year – which, if represented across the whole SME community, could see 250,000 small businesses shut in 2021.
In the South West, more than half of those surveyed said they had seen profits decrease in the final quarter of 2020 with even more expecting them to fall in the coming three months. And, in employment terms, nearly one in four South West small businesses said they had reduced their workforce between October and December.
On a more positive note, small business confidence in the South West, though very low, was higher than the national average and also, even in the midst of the crisis, ten percent of the region’s firms had increased their workforce.
Overall, however, the report paints a negative picture and the FSB’s South West Regional Chairman Lee Nathan – whose business has bases in both Bristol and Devon – said the survey results were understandable considering the pressures small businesses are facing at the moment.
He said, “Once again these figures reflect how difficult it is out there for small businesses and they are a stark reminder about why it is so important that the Government continues to find new and innovative ways to help SMEs. It is small businesses who will be part of the solution for economic recovery but they can only do it if they get that extra support now.
“Helping small businesses is not a giveaway – it is an investment in the future.”
Reflecting on the national report findings, FSB Chairman Mike Cherry said it was time for the Government to act quickly to help restore ailing confidence.
He explained, “The development of business support measures has not kept pace with intensifying restrictions. As a result, we risk losing hundreds of thousands of great, ultimately viable small businesses this year, at huge cost to local communities and individual livelihoods.
“At the outset of the first national lockdown, the UK Government was bold. The support mechanisms put in place weren’t perfect, but they were an exceptionally good starting point. That’s why it’s so disappointing that it met the second lockdown with a whimper. This Government can stem losses and protect the businesses of the future – but only if it acts now.”
FSB surveyed 1,401 small firms for the Q4 2020 Small Business Index at the end of December 2020.
Pictured above: Lee Nathan, FSB’s South West Regional Chairman