It’s a bleak outlook from the British Chambers of Commerce which reported earlier this week that there are ‘no signs of business recovery’.
The BCC’s Quarterly Economic Survey Q4 2022 showed:
- After significant declines across all business conditions tracked by the BCC in Q3, most indicators have stabilised at a low level.
- Profitability confidence remains at Covid-crisis levels; only one in three (34%) businesses believe their profits will increase over the coming year, while more (36%) expect a decline.
- Just 33% of firms experienced an increase in sales over the past three months, while 25% of firms reported a decrease, with hospitality firms the least likely to report improvements.
- More firms are reporting taxation (38%) and interest rates (43%) as growing business concerns.
The quarterly survey includes responses from 5,600 firms, mostly SMEs.
In a press release, David Bharier, Head of Research at the British Chambers of Commerce (BCC), said: “These results provide further confirmation that business conditions deteriorated significantly in the second half of 2022.
“The situation remains critical for the majority of SMEs who find themselves cut adrift by monumental inflationary pressures, often driving triple-digit percentage cost increases, particularly on energy.
“Business confidence remains worryingly low, with only a third of firms reporting improvements to sales, and less than a quarter reporting increased investment. The widespread economic damage caused by Covid shutdowns has been compounded by subsequent inflation, global trade crises, and new trade barriers with the EU. For many SMEs, the cost of doing business is now simply too high.
“While the change in administrations from Truss to Sunak may have stabilised markets, the Autumn Statement on 17 November appears to have had no impact on business confidence. Indeed, while inflation is still by far and away the top concern for businesses, taxation has now become far more of an issue for SMEs.
“These results reaffirm the need to create a stable environment for businesses to invest, with energy, improvements to infrastructure, access to skills, and removal of trade barriers, particularly with the EU, all top priorities for firms.”
Read the full press release.
