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Business confidence weak in areas reliant on public sector

Small businesses and contractor accountants are now less confident in their ability to create new jobs, according to research conducted by the FPB.

The end of last year was hard for the small business community and more of them than expected reduced their headcount. The immediate outlook is a little more encouraging and fewer SMEs expect to cut their payroll. However, business confidence is still weak in areas that depend heavily on the public sector. In Northern Ireland, confidence levels are at -25% and in Wales -11%.

22% of small businesses intend to hire new employees this year but this figure is well down on the 30% who were optimistic of growing their workforce when asked last December.

Two thirds of those planning to hire, expect to take on ready-trained employees whilst a third think they will have to devote time to training their new recruits.

37% of respondents to the survey expressed concerns about whether new employees would be able to fit in, 36% worried about the cost and amount of time needed to comply with employment regulations and a similar percentage said the lack of specialist or technical skills amongst new-hires made them anxious.

John Walker, the chairman of the FPB, said it was worrying that more small businesses than anticipated had to make staff redundant, especially with female and youth unemployment edging towards 1 million.

Small businesses need the government to give them a hand if they are to pick up the fallout from the austerity drive, he pointed out.

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Image: Heart Monitor by Rennett Stowe

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