Entrepreneurs' confidence takes a knock

Small business owners' confidence in the economy has dipped, new research reveals

Figures from Bank of Scotland's (BoS) latest index - on which the lower the score the higher the pessimism - showed small business owners' faith in positive economic conditions stands at 42, down from 48 in April.

Some 63% of respondents believed the general economic situation will decline over the next 12 months, a 24% increase on those predicting the same during the third quarter of the year. Similarly, almost half of entrepreneurs were worried about the prospects for the UK's small business sector with only 25% remaining confident.

In addition, only a third believed now is a good time to run a small firm compared to almost four in 10 who thought the opposite.

Ivan Matviak, head of BoS' business banking division, said the figures showed that the UK's credit crunch, which has seen banks reign in landing, is starting to impact on small firms.

"These findings suggest that we can expect recruitment to be measured and growth to be steady but slowing," he added.

"However, faced with a growing tax burden and an impenetrable maze of red tape, businesses will have to continue operating in a regulatory and fiscal environment that offers very little support or encouragement."

[Source: AccountingWeb]



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