A large majority of small businesses are dissatisfied with the Government’s handling of the financial and economic crisis and believe that neither the Government nor the banks have done enough to support the sector over the past 18 months, according to the latest opinion survey by XLN Telecom, the UK’s leading telecoms company serving the small business community.
Only just over a quarter of more than 650 businesses surveyed expressed any optimism about the coming 12 months, while nearly half said they were somewhat or very pessimistic.
According to the Department for Business Innovation and Skills (BIS), small and medium-sized enterprises (SMEs) account for 99.9% of all enterprises in the UK, 59.4% of private sector employment and 50.1% of private sector turnover. Total employment in the sector is estimated at 13.7 million and turnover at £1,500 billion.
The only comfort for the Government in the survey is that despite their dissatisfaction and pessimism, SMEs do not appear to have much confidence that the Conservative opposition would do any better – asked whether a change in government would improve economic conditions, only a third (34%) said yes, while almost the same proportion (32%) said no, and 34% had no opinion.
However, a massive 88% of respondents to the XLN Telecom survey expressed the view that increases in VAT, national insurance rates and corporation tax meant that small businesses were having to carry unfair tax burdens as a result of the banks being bailed out. Similar proportions said they thought the Government (87%) and the banks (90%) had not done enough to support the sector during the crisis.
Only just over a quarter of respondents (27%) expected their businesses to show some growth over the next 12 months, while nearly as many (26%) expected to shrink, and nearly half expected to remain flat.
On the employment front, the XLN survey does however show some signs of encouragement, there being a significantly greater number of businesses considering hiring again over the next twelve months compared to those contemplating further redundancies (16% increasing versus 10% decreasing). The overwhelming majority (62%), however, nevertheless expected staffing levels to remain the same during the year.
XLN Telecom Group CEO and co-founder, Christian Nellemann, commented:
“The BIS statistics are clear evidence of how critical SMEs are for the UK economy and for employment. And whilst our survey shows that in employment terms they are starting to turn the corner, they feel angry by the lack of meaningful support shown to them over the last eighteen months by the Government.”
