Shropshire small business confidence rallies according to new survey

Research published by the Federation of Small Businesses (FSB) showed confidence was up compared to the previous quarter.

While still in negative territory and below the national average, small firms in the region were significantly more confident than they were in the same period in 2022, the report suggested.

“It’s always good to see an upturn in local small business confidence," said Mike Goodall, development manager at the Federation for Small Businesses in Shropshire, Herefordshire and Worcestershire.

"However, there’s no escaping the fact that the improvement is small and follows a big decline in the previous quarter.

"From my discussions with Shropshire-based small business owners, many say they are simply getting on with business the best they can. They, and all small business owners, would benefit from greater certainty about the political and economic outlook, so that they can plan with confidence and plan for sustained growth”.

In terms of revenue, performance during quarter four 2023 saw little change from the third quarter. However, expectations for quarter one of 2024 are more positive.

There was a small decline in net employment levels in quarter three. More than one in 10 reduced staff compared to just one in 20 increasing numbers. However, almost three quarters (74 per cent) saw no change and expected improvements in the next three months.

Almost three quarters of respondents said that they had increased average salaries and an even higher proportion expect further increases in next 12 months.

More than half (55 per cent) expected to grow either rapidly or moderately in the next 12 months. Far fewer (10 per cent) expected to downsize or close – a marked improvement over the previous quarter when almost 20 per cent expected to contract. A slightly higher proportion of small businesses expect to increase investment in the next 12 months than decrease it, a situation unchanged from quarter three but below the national average.

The most commonly cited challenges facing the region’s small businesses were the general economic conditions in the UK (71 per cent) and flat or weak consumer demand (51 per cent).

Rob Harrison, FSB West Midlands policy representative and director of local communications agency Glued, said: “While it is encouraging to see overall levels of confidence improving slightly in quarter four 2023, it is also noticeable that the improvement is modest and remains in negative territory.

"This is probably due to the continued uncertainty around the domestic and international political and trading environments. Hopefully the changes announced in the Autumn Statement will feed through to more positive findings for the first quarter of 2024.

"However, this is no time for complacency. The Federation of Small Businesses will continue to press the Government for more, small-business-friendly policies in its March Budget to reduce uncertainty and give small business owners the confidence they need to plan ahead and achieve sustainable growth”.

Mr Goodall added: “We welcomed a number of announcements made in the Autumn Statement and these should feed through to more positive results in the first quarter of 2024.

"The next opportunity for the Government to create the conditions for small business growth will come with the Budget in March. We are feeding in constructive ideas to help achieve the best possible outcomes for small businesses in Shropshire and beyond."