Business leaders brace for a cold winter
Temperatures are set to fall again as a mid-week cold snap muscles in, bringing icy winds to accompany the latest batch of chilling economic data.
Several business organisations have just released their latest research, and the findings ought to chill the blood of complacent government ministers.
Since the Budget, City PM has reported daily on the concerns and fears of individual businesses, trade associations and expert commentators, all of whom (spanning a range of sectors and professions) have warned that the increases in business taxes, labour costs and regulation will have a serious impact on their operations and – by definition – the wider economy.
We haven’t been doing this for sport; we have amplified the voices of people who know what they’re talking about in order to increase the chance that the government hears them. Alas, as recently as last week, the Chancellor was still insisting that her Budget will be “good for jobs and good for growth.”
As if further evidence that she might be wrong was needed, the latest Economic Confidence Index compiled by the Institute of Directors makes a stark comparison between conditions six months into a Labour government, and conditions six weeks into the catastrophic Covid pandemic.
The November data shows confidence among business leaders has slumped to minus 65, just four points off the record low scored in April 2020. Confidence in their own commercial performance has crashed to minus seven, just a single point off the record low of May 2020. The survey shows investment and hiring expectations are also in the dirt.
Meanwhile, the London Chamber of Commerce and Industry published its most recent survey of members today, showing that just a handful of business leaders have any confidence in the government’s growth agenda. Around half say they will implement a hiring freeze and that pay for staff will be lower next year than it otherwise would have been.
The final word in this chilly start to the week goes to Family Business UK (a membership group representing family-owned firms) which has produced analysis showing the Budget’s raid on inheritance tax relief for family businesses could trigger a deluge of job losses and cancelled investment.
And it’s only Monday.
Ministers urgently need to look again at the Budget’s anticipated consequences. If they don’t, they won’t be able to claim they weren’t warned.