Small business confidence is at its lowest level since 2013 despite a strong labour market.
The latest UK jobs numbers show employment up by 55,000 and unemployment down by 20,000. Wage growth has risen slightly – with average earnings, including bonuses, up by 2.0%, a consistent rate of growth with the previous period.
However, although the UK continues to make steady gains in employment and wages, current market fluctuations and political uncertainty are likely to impact numbers in future months.
This is according to the latest Federation of Small Businesses (FSB) Small Business Index, which suggests the overall economic outlook is far from certain.
FSB national chairman Mike Cherry said: “The unemployment rate is at historically low levels, but this does not seem to be translating into broader business confidence. Clearly there are other factors at play which, although not hitting jobs now, are causing business owners to take a cautious approach.
“Small businesses are already dealing with considerable new cost challenges, including the National Living Wage and pensions auto-enrolment deadlines. Whatever the result of the coming EU referendum – small business will need reassurances that the outcome will not increase the cost of doing business.”