Small business confidence reaches three-year high
27th June 2013 | News
Confidence among Britain’s small and medium-sized enterprises (SMEs) has risen to its highest level in over three years, according to the Federation of Small Business’s (FSB) Small Business Index.
Its unique measure of confidence reached 15.9 points in the second quarter of 2013; 9.6 points higher than at the turn of the year and the second highest reading since the Index began in 2010.
Small firms in financial services reported the highest confidence levels, while small manufacturers were also significantly more optimistic about their prospects than previous measures.
With Chancellor, George Osborne delivering his Spending Review this month, the FSB believes now is the ideal time to build on the foundations of these positive figures with fresh initiatives for growth to maintain small business confidence levels and encourage growth.
John Allan, national chairman of the FSB, said: "This is all good news, but we must not be complacent. The Chancellor must use the Spending Review to build on this optimism.
"While there are positive signs, inflation and not being able to access finance will affect how quickly, and how much, small firms can grow and create jobs."
The FSB’s report calls for the Government’s Business Bank to improve competition in the banking sector and advise small firms on alternative finance providers.
Although Funding for Lending isn’t getting finance to more businesses at present, the lending rates offered are becoming lower.
A significant number of small firms have indicated they expect to increase staffing levels in the next three months, which is likely to be aided by the Enterprise Allowance announcement made at the next Budget, and is due to come into force next year.
More small firms are also reporting a rise in exports – despite slow trade growth globally – and export growth in the UK is expected to improve further in the next quarter.