Official inflation data - January 2023

Confidence for me and my small business is much higher than it was in autumn 2022. Inflation in the double digits is still a killer, as are the much higher costs to doing business, which depresses profitability. However there is a lot more positive sentiment among the businesses I’m speaking to, as well as a positive feeling for the future of my own business as we look towards Spring. It’s hard to look on to see what’s happening with the High Street’s collapse, but I feel this sea change is more of a societal shift that has been urged on quicker by the events of the past few years.

I am feeling positive about the economy. We're busier than ever, with new vacancies coming in daily from our clients. February has been a record month for new vacancies, and I'm hopeful that the increased confidence in the economy will bring even more. You can tell that businesses within certain sectors are trying to save on costs (likely due to them suffering from inflation) as they are negotiating with us, and I expect this will continue throughout 2023.

The Bank of England being more upbeat about the economy only proves to me how far removed they, and the government, are from what's happening on the ground. My business is bringing in more than it ever has but costs are so high my margins have been decimated. I’m doing what I can to mitigate these costs and survive but they are sticking their head in the sand. Meanwhile, the way the business rates goal posts have effectively been moved just put the last nail in the coffin of many small businesses. One business here in Glasgow is now expected to pay £1,400 a month after being previously exempt. This feels a distasteful time to do this and will kill many small businesses off.

Inflation may have come down slightly in January but the raw material costs for my business are still increasing, which doesn't stack up. This has left me apprehensive about investing in my business and creating employment opportunities. Inflation has been a hammer blow for businesses around the UK and it's impossible to get excited about the future with a government that seems to show no interest in the welfare of small businesses and, just as importantly, helping us to grow. Let's hope inflation comes down rapidly in the months ahead as the pressure on small businesses is immense.

Double-digit inflation has impacted overheads across the business. The main areas are in utilities and transport costs, however even subscriptions and service costs have all edged up as businesses respond to the changes. Despite this, we are feeling positive about the year ahead. We experienced a lull in new business in the last quarter of 2022, but 2023 for us so far has been strong, both in terms of new leads into the business, and contracts signed. In January, we saw around a 59% increase in enquiries compared to December. While things are far from perfect, it feels like some energy is coming back into the economy.