Small business growth forecasts have finally returned to pre-Covid levels – with London, the South East and Yorkshire driving resurgent confidence for the next three-months.
The new research findings from the quarterly Business Barometer by Hitachi Capital Business Finance reveal that the percentage of small business owners predicting growth has soared from 26 to 36 per cent since January – the highest quarter-on-quarter rise for four years.
Following a crash in growth forecasts during the first Lockdown in March 2020 – falling from 39 to 14 per cent overnight – the proportion of small business owners predicting growth levelled at around 26 per cent for the next nine-months.
The latest figures suggest that the significant progress of the Covid vaccination programme, together with easing of social restrictions, has had a profound impact on small business confidence, with the percentage of enterprises predicting growth now having fully returned to pre-pandemic levels.
the clearest sign yet that small businesses have moved beyond survival mode and are now planning for recovery
Regionally, small businesses in London (48%), Yorkshire (44%) and the South East (42%) were most likely to predict growth. In the West Midlands, forecasts were less emphatic (28%), although this was also the region where fewest small business owners predicted they would struggle to survive or face closure in the next three months (5%).
Joanna Morris, Head of Insight at Hitachi Capital Business Finance said: “The research, which was conducted going into the Easter weekend, could not bring more welcome news for the economy at large.
“More than just a breakthrough on the previous nine-months’ data, our tracking research suggests small business confidence is now back at its pre-Covid levels. These findings coincide with the impressive roll-out of the vaccine, the drop in Covid cases and the country being on-track to see the end of social restrictions by the end of June.
“Our research gives the clearest sign yet that small businesses have moved beyond survival mode and are now planning for recovery.
“The improved levels of business owner confidence in sectors such as retail, hospitality and construction are significant and, nationally, it is noteworthy that the percentage of small businesses fearing collapse has shrunk to single figures for the first time in 12-months.”