Quarter of 1,000,000 small companies set to fold with out extra Covid assist
Over 250,000 small businesses are set to close this year without further Covid financial help, according to the latest FSB study.
Five per cent of small businesses surveyed said they do not expect to struggle on beyond 2021.
One in five small businesses made staff redundant between October and December last year. One in seven expect to do so before April.
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The quarterly Federation of Small Businesses (FSB) Small Business Index (SBI) showed confidence at second lowest ebb in report’s 10-year history.
And the cohort expecting profits to fall in the first quarter this year hit an all-time high, with exporters having to deal with EU red tape as the UK-EU trade deal shakes down.
Mike Cherry, chairman of the FSB, said that although small business has welcomed the Covid help lifelines thrown to the retail, hospitality and leisure sectors, the government must realise that the small community is wider than that.
Nothing has been done for company directors, the newly self-employed and those who do not use commercial premises, Mr Cherry said.
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Last week, the FSB published a five-point plan to resuscitate small businesses on life support because of the pandemic.
It also wants to see the government issue Brexit transition vouches, in line with Ireland and the Netherlands, to help firms cope with new bureaucracy because of the UK-EU trade deal.
Mr Cherry added: “The development of business support measures has not kept pace with intensifying restrictions. As a result, we risk losing hundreds of thousands of great, ultimately viable small businesses this year, at huge cost to local communities and individual livelihoods.
“A record number say they plan to close over the next 12 months, and they were saying that even before news of the latest lockdown came through.”
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