Record number of small firms have already cut jobs, says FSB report

A record number of small firms have already cut jobs, according to a new study by a Lancashire-headquartered business group.

Tuesday, 28th July 2020, 12:30 pm
Many firms have had to let workers go

Almost one in four of 1,400 small business owners surveyed said they had reduced headcounts over the last three months.

The Blackpool-headquartered Federation of Small Businesses said its research indicated that business expectations of future performance were “increasingly polarised”.

The latest quarterly Small Business Index from FSB shows that a sizeable share of firms have already had to let staff go.

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Over a fifth of the 1,400 business owners surveyed for the study expect their performance to be “much worse” over the coming quarter compared to the last three months.

The figure is up 13 percentage points compared to this time last year but is down considerably on Q1 2020.

The proportion who expect their prospects to be “much improved” compared to the last quarter has risen significantly, standing at just above one in 10.

More than half of firms surveyed expect their performance to remain stable or worsen over the next three months.

But four in 10 expect a relative improvement as lockdown restrictions lift.

Those in the construction and accommodation and food service sectors are among the most confident about a relative uplift in performance next quarter.

FSB National Chairman Mike Cherry said: “The majority of small business owners have benefitted from the Government’s emergency support measures but many have not.

“We urgently need to see the Treasury outline how it intends to support those who have been left out, not least company directors and the newly self-employed.

“Additional help for those who are being forced to stay closed while others re-open is also a must,” added Mr Cherry.