A survey carried out by the Federation of Small Businesses (FSB) has found that confidence amongst small firms rebounded between the fourth quarter of 2022 and the first quarter of 2023.
The FSB’s Small Business Index (SBI) showed that confidence rose to -2.8 in the first quarter of 2023, which is 43 points higher than the reading recorded in the fourth quarter of 2022.
However, 92% of small businesses polled stated that their costs were higher in the first quarter of 2023 than in the same quarter last year. Additionally, 71% of firms said salary costs were higher when compared to the same period in 2022.
Martin McTague, National Chair of the FSB, said: ‘There are still plenty of dark clouds on the horizon that could dampen small business recovery. The prospect of further interest rate rises is causing significant disquiet, at the same time that costs remain at serious highs.
‘If rate hikes outpace or outlast the prices they are meant to control, this would be an extra pressure on small firms whose cash reserves remain at historic lows, and it’s no surprise that small firms’ views of available finance options are downbeat, in line with their abilities to invest and grow.’