Small businesses in East of England report rise in confidence but lag behind UK average
Business owners say economic conditions are a big barrier to growth
Small businesses in the East of England have reported a sharp increase in confidence, according to a new report from the Federation of Small Businesses (FSB).
However, it also reveals businesses in our region remain significantly more pessimistic than firms in other areas of the country, with the Northeast and Yorkshire taking the top spot for business confidence.
During the first three months of 2024, small firms reported an uptick in confidence – the first positive score after seven consecutive quarters of negativity.
The FSB tells us this positivity didn’t filter through to the revenue generated by businesses in our region though – with 43% reporting a decrease in revenue compared to just 28% that reported an increase.
Candy Richards, Development Manager for East Anglia said: “It is a positive step to see local businesses cautiously report greater confidence after a prolonged period of pessimism.
"However, there is still a long way to go before our businesses feel that the tide is turning, and the economy is strong enough to focus on investment and growth.”
The report also showed that investment intentions lagged stubbornly behind the rest of the UK, with just the Southwest and Midlands reporting lower scores.
General domestic economic conditions were cited as the biggest barrier to growth, with 63% reporting it as a concern. 66% also reported increased staff costs, impacting their business.
Candy continued: “Speaking with our many small business members, we know that things remain tough, particularly in sectors such as hospitality, construction, and manufacturing, where a fragile economy and an extended period of inflation has hit businesses hard.
"Although inflation is now easing, households are still seeing their budgets squeezed and this is translating into a reduction in discretionary spending and a delay in making big-ticket purchases.
“As we gear up for a general election, it is vital that all parties have small businesses front and centre of their manifestos. We need to see bold policies for supporting small businesses who have borne the brunt of our weakened economy.”