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UK small-business confidence plummets, worst in Scotland, Northen Ireland
[EDINBURGH] Confidence among Britain's small businesses has plummeted, a survey showed on Friday, with Northern Irish and Scottish businesses the least confident in the face of a global economic slowdown and public-sector austerity.
The Federation of Small Businesses (FSB) first-quarter survey showed the first decline in job creation by small firms nationwide since mid-2013.
Finance minister George Osborne gave tax breaks to small businesses in Wednesday's budget after downgrading growth forecasts, but the outlook is clouded by an upcoming vote on whether Britain should remain a member of the European Union membership .
A separate FSB survey earlier this month found 42 per cent of 4,000 members were undecided about how they would vote on the EU, and more than half felt they were not well-enough informed.
The Small Business Index, measuring business prospects over the coming three months, fell to 8.6 in the first quarter from 28.7 a year ago, its lowest since a -5.6 reading in the fourth quarter of 2012.
Optimism has fallen year-on-year this quarter in every part of the UK, with the largest declines in the East of England and London.
One in four small firms cited tax and regulatory burdens as a restraining factor, and exports had their weakest performance since 2012.
In Northern Ireland, where confidence ratings are negative, the report highlighted the region's dependence on the public sector, which is cutting jobs and keeping a lid on pay.
It said the decision last month by plane maker Bombardier Inc to cut over 1,000 Belfast jobs was also likely to weigh on confidence and hurt small firms in the supply chain.
In Scotland, where pessimism was also prevalent, the survey noted the impact of a slump in oil prices, which has hurt Scotland's oil-dependent northeast, as well as pressures on the services sector.
Almost two-thirds of Scottish business owners said the state of the domestic economy was a barrier to their own growth.