Most small firms fear long-term fallout from UK’s cost of living crisis

theguardian.com:

Three-quarters of small and medium-sized companies are worried about the long-term impact the cost of living crisis, soaring energy bills and rising inflation will have on their business, a survey has found.

Just over half (51%) of SMEs said they were concerned that rocketing prices would dent consumer spending, in response to Barclays’ SME Barometer, a quarterly survey of business sentiment conducted for the bank.

Rising energy bills and higher raw material costs are putting pressure on businesses and creating a challenging trading environment.

More than a quarter of the 574 firms surveyed said they feared that having to increase their own prices in response would make them less competitive.

A tight labour market is putting further pressure on businesses, they reported, with some struggling to hire new staff. Recently companies across a range of industries, from nurseries to nightclubs, have reported problems finding workers to fill vital roles.

However, the four-day bank holiday weekend for the Queen’s platinum jubilee provided a rare bright spot for SMEs, who said they believed sales would rise during the break.

The late May bank holiday has been moved to 2 June, creating an extended break from then until 5 June, as part of a year of events marking the first time a British monarch has been on the throne for seven decades.

Independent pubs, bars and restaurants are expecting a sales boost worth about £76m during the jubilee celebrations on Thursday and Friday.

Businesses who responded to the Barclaycard survey predicted that the festivities would bump up their revenue. Six in 10 SMEs said they were forecasting 10% higher sales on average between April and June compared with the same quarter a year earlier.

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