Employers warn of job losses following ‘business bashing’ Budget
Jobs will be lost and companies will cease trading in the new year as Shropshire employers wrestle with the financial implications of the Government’s ‘business bashing’ Budget, it has been claimed.
The latest quarterly economic survey from Shropshire Chamber of Commerce has revealed some of the most downbeat forecasts from the local business community since the pandemic.
Asked about the November Budget’s impact on the local business community, 72% described it as negative, and not a single employer felt it was positive.
The proportion of businesses now seeing taxation as a ‘fear factor’ in the coming months has jumped by a huge 40%, and there has been a 14% fall in businesses reporting rising sales.
The survey, carried out in the weeks after the Budget and covering the final three months of 2024, found that more than a quarter of firms were seeing credit terms getting worse, while around a third said bad debts were on the rise.
One hospitality business said: “Our bad debts have increased slightly, and we fully expect a number of businesses to cease trading after the Christmas period.
Another said: “We have been in business for nearly 20 years, and the current economic climate is the worst we have experienced. We are in survival mode.”
Three quarters of businesses which took part in the survey said they expected turnover to fall – a rise of 23% on the previous three months – while nearly 80% of employers predicted a drop in profits.
One professional services business said: “We have more taxes to pay, wages, energy and rents costs all increase annually, but we are still in a competitive market, so our charge-out rates can’t keep up.”
A retail business added: “All indicators are for a continued decline in both turnover and profitability. Increasing costs cannot be absorbed. If we increase prices, we lose sales.”
And a construction company said: “Our National Insurance costs are approximately £16,000 up. Although all of our staff are above the minimum wage level, they are asking for the same percentage rise of 6%. It’s difficult to increase our prices as our customers are struggling.”
One of the few positive figures in the report came with international trade, with an 11% rise in companies seeing growing exports, and a 16% jump in those reporting a rise in future export orders.
Any business of any size with a base in either Telford & Wrekin or Shropshire is eligible to take part in the Shropshire Chamber quarterly economic survey.
The results are fed into the national survey by the British Chambers of Commerce, which is used by the Bank of England and other relevant bodies and economists to influence major policy decisions such as the setting of interest rates.
Alex Brown, from Shropshire Chamber’s policy team, said: “Was this a business bashing Budget? Our results say a definite yes.
“Workers were told that the pound in their pocket is safe – not so, say businesses. Increased National Insurance and minimum wage rates alone have prompted businesses to warn of redundancies.”
