New research has found that there has been a strong improvement in the confidence of small businesses, suggesting the sector will grow this year, with the poll showing a “robust” improvement in optimism in the past three months.
According to the Federation of Small Businesses (FSB), growth and investment intentions reached new highs since the organisation began compiling its index in 2010 and the incidence of “negatives” in the overall picture had also decreased.
The FSB said that the latest survey readings on job creation, productivity and investment point to small businesses sustaining the economy’s growth through 2015, with almost two-thirds of those polled aspiring to grow moderately or rapidly in the next three months, the highest figure ever seen by the index.
The Federation also said that productivity in the sector was increasing compared to the wider economy, something that should be encouraging to policymakers, who have been grappling with the issue of low productivity growth for some time.
The survey results include the fact that one third of firms plan to increase capital investment over the next 12 months. Meanwhile, the proportion of businesses that have employed new staff has risen to 8.9%, a sharp increase from the 2% reported 12 months ago; a balance of 24.1% of firms saw increased revenues, while 17.4% were reporting higher profits. In addition, wage rises within small businesses are now line with the economy overall, with an average increase of 1.9%.
Meanwhile, as far as expansion is concerned, when it comes to exporting, 28.6% are now exploring overseas markets, up from a consistent 25%, while small business confidence levels remain steady, with a score of +37.9.