Responding to the latest figures from the Office for National Statistics (ONS) showing that UK gross domestic product (GDP) and total exports dropped by 7.8% and 10.3% respectively in February 2021 compared to the same month last year, Federation of Small Businesses (FSB) National Chairman Mike Cherry said:
“If you’d asked small business owners at this time last year about Covid-linked disruption they wouldn’t have dreamed it would be continuing so far into the future.
“These stark figures are a reminder that this lockdown needs to be the last: better to unlock more slowly than to rush and have a repeat of the damaging chaos suffered in the run-up to last year’s critical festive trading season.
“Small business confidence has now rebounded but a sizeable share of employers are concerned about redundancies with the job retention scheme winding down over the coming months.
“The Government should now turn to its build back better agenda: cutting the non-wage costs of employment to spur hiring, ending a debilitating late payment crisis that has worsened through lockdowns, and taking innovative approaches to emergency debt to realise meaningful economic value.
“Consumer-facing service businesses are shown to be especially hard hit in today’s update, so it’s good that many can now start to trade again across England. We’re urging all shoppers to support local small firms wherever possible over the months ahead.
“UK exports have tumbled since the end of the transition period. Whilst the SME Brexit Support Fund offers some much-needed help to small importers and exporters trying to get their heads around new rules, it’s important that it is now promoted effectively so as many eligible firms as possible benefit from its installation.
“International sales are way down on where they were at this time last year. A fifth of small exporters have halted sales to the EU temporarily and some have already given up on selling into the bloc on a permanent basis.
“Unless further action is taken to alleviate the new admin facing exporters, which tend to be our most innovative and profitable firms, we risk losing them.
“Uprating the value of sale threshold at which taxes and tariffs kick in for imports and exports to £1,000 would be the most constructive starting point.
“We also need to see policymakers pulling out all the stops to strike ambitious new trade deals, which include small business chapters, with high-growth economies where there’s appetite for UK goods, not least the US.”
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About FSB
As the UK’s largest business support group, FSB is the voice of the UK’s small businesses and the self-employed. Established over 40 years ago to help its members succeed in business, FSB is a non-profit making and non-party political organisation that’s led by its members, for its members. As the UK’s leading business campaigner, FSB is focused on delivering change which supports smaller businesses to grow and succeed.
FSB offers members a wide range of vital business services, including access to finance, business banking, legal advice and support along with a powerful voice in Government. Each year FSB also runs the UK’s Celebrating Small Business Awards. More information is available at www.fsb.org.uk. You can follow us on twitter @fsb_policy and on Instagram @fsb_uk.