News in brief: employment figures; overdrafts; FSB

News in brief
News in brief

Latest employment figures show increases in the number of people in work

The latest official figures from the Office of National Statistics show increases in the number of people in work and a sharp fall in the number of claimants.

Commenting on the figures Labour Market Analyst at the CIPD, the professional body for HR and people development, Gerwyn Davies said: “[There are] signs that wage pressure is moderating against the backdrop of historically low levels of inflation strengthens the Bank of England case for not hiking in interest rates in the next few months, despite unemployment falling to a seven-year low.

“Harsh critics might point out that a relatively large proportion of the jobs are part-time. However this follows a period of strong growth in full-time employment. Against the backdrop of its net migration target and the EU debate, the only potential worry for the government perversely is the sharp increase in the number of non-UK nationals in employment. The increase is driven by non-UK nationals from the EU that now make up two million of the UK workforce for the first time.”

Research shows that employers have headed off the threat from skills shortages by hiring more young people, upskilling the existing workforce and turning to migrant workers.

Now overdraft platform for SMEs launches in the UK

Growth Street, a new business overdraft platform, has been launched to address the chronic lack of overdrafts for SMEs in the UK. The company offers flexible business overdrafts of up to £150,000. Growth Street uses cloud-based software to review SME financial data, offering insight into the financial health of a business, resulting in better credit terms at fairer prices.

“SME finance in the UK is fundamentally broken,” said Growth Street CEO James Sherwin-Smith. Over the last three years there has been an almost 50% fall in bank overdraft facilities for smaller businesses and the amount borrowed has tumbled dramatically. According to the Bank of England, the aggregate balance of SME overdrafts has fallen from £21 billion in April 2011, to fewer than £13 billion by August 2015. This enormous drop has resulted in a massive short term working capital gap.”

FSB welcomes David Cameron’s reform plans for the EU

The Federation of Small Businesses (FSB) has welcomed Prime Minister David Cameron’s plan to focus on pushing the European Union to become more competitive and announced support for a target to reduce the regulatory burden across the EU.

Commenting on the plans, national chairman of the FSB John Allan said: “The UK is one of the easiest places in the world to start up a business. However, it must also be the easiest place to run and grow that business. All EU decision-makers should ‘Think Small First’ before they regulate, and we would like to see the negotiations embed that principle to boost economic growth.

“The FSB has written a formal letter to the Prime Minister David Cameron to raise the EU issues that are of most concern to our members. In this we welcome the focus to protect the Single Market and call on both the UK Government and the EU to ensure laws such as the new proposed Data Protection Regulation does not impede this. The FSB would also like a closer focus at simplifying VAT to make it easier for small businesses to engage in cross border trade. Other important issues include the reform of the REACH Directive and maintaining the opt out from the Working Time Directive.”