Scottish small business confidence down again as cost of doing business crisis endures
Scotland’s small business confidence fell again in the final quarter of 2022, latest figures from the Federation of Small Businesses (FSB) show.
The small business group’s Small Business Index (SBI) now sits at -50 points for Scotland, down on the -45 reported the previous quarter. It is also significantly lower than the same quarter in 2021 (-22).
The equivalent UK-wide confidence figure is -45.8, which is also down on the previous quarter (-35.9), but 4.1 points ahead of Scotland.
Andrew McRae, FSB’s Scotland Policy Chair, said: “Scotland’s small business community has endured an unprecedented sequence of challenges over the last two and a half years. Rising inflation, increasing energy prices, and staff shortages to name a few. The constant battle to just survive during this cost of doing business crisis means it is no surprise that confidence levels are now at their lowest on record, outside of Covid lockdowns.
“Small business owners are a steadfast bunch and keep swimming against the tide of economic uncertainty. But they need help to keep their heads above water. It is therefore vital that governments in Holyrood and Westminster focus on support and stability by pausing the introduction of new regulations, supporting sectors most in need and reconsidering the energy cost support on offer after March.
“This refocussing would help develop an operating environment with, if not certainty, then at least less turmoil; and an environment where small businesses can survive, and even thrive, and drive the economic growth needed to get the economy back on its feet.”
The SBI also shows that almost nine out of every ten businesses (86.2%) have seen a sizeable change in their business costs over the last 12 months, with increases in fuel and utilities the most common drivers.
Almost half of businesses (42%) expect to run below capacity over the next three months and only a third (32.7%) are expecting to grow in the next 12 months.
It is worth noting that this survey was taken in December 2022, before the announcement by UK Government that business support for energy costs would be cut significantly from April.