A new study carried out by the Federation of Small Businesses (FSB) has revealed a drop in business confidence among Britain’s small and medium-sized enterprises (SMEs).
According to the report, business confidence has been hit by political uncertainty spurred on by the surprise General Election result, and financial fears stemming from ever-rising operating costs.
It adds that more than half (52 per cent) of SMEs are currently concerned that a slowing economy could act as a barrier to their potential growth in the near future.
Mike Cherry, national chairman of the FSB, said that the Government would need to offer more support to small businesses in a bid to create a more “balanced economy”.
He said: “Small businesses were feeling pessimistic even before the General Election was called.
“Now, alongside increasing inflationary pressure, a business rates revaluation and rising labour costs, they have a whole new wave of political uncertainty to contend with.
“The £300m hardship fund announced at the Spring Budget to help those worst affected offered a glimmer of hope, but is yet to materialise.”
He added that consumer-facing businesses were “really starting to feel the squeeze” and that many were “still reeling” from April’s business rates hike.
He also said: “Many small firms that operate in the retail and hospitality sectors depend on EU 27 workers. Ensuring these vital employees have the right to remain needs to be a first port of call once Brexit talks launch.”