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The economy and you Feb 2023

ended 09. February 2023

On Friday morning at 07:00, we'll discover whether the country was in recession in the fourth quarter of last year or (narrowly) avoided it. Either way, it will be the story of the day and dominate the local and national media. Firstly, we have lots of producers looking for small businesses and charities to interview around the UK, so if you're available for interviews, let us know and we will do our best to line up slots tomorrow. Secondly, please answer the three Qs below and we'll issue your responses to the local, national and relevant trade media on Friday morning.

  • With some positive signals coming from the Bank of England, inflation predicted to edge down and interest rates potentially near their peak, are you feeling a bit more upbeat — or are things still difficult?
  • What are the main challenges facing you as a small business or charity right now?
  • Is there one particular thing you would like the Chancellor or Bank of England to do to help businesses and charities like yours (e.g. scrap impending tax cuts, cut interest rates as inflation is imported anyway)?

7 responses from the Newspage community

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Editor
Samuel Mather-Holgate
Independent Financial Adviser at Mather and Murray Financial
The biggest headwind for businesses right now remains the uncertainty around energy bills now that the Chancellor has confirmed there will be no support after the end of March. Add rising interest rates and the lack of confidence in the economy that this creates and most businesses are nervous about the months to come. The good news is inflation should fall significantly over the next three months. The bad news is the Bank of England will be glacial in its response to good news meaning the recession will last longer than necessary.
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Editor
Mary Maguire
Managing Director at Astute Recruitment Ltd
Friday morning!
GDP warning?
As a top recruiter,
We're feeling great about the future!
With more jobs than before,
Our SMEs are recruiting galore!
So whether UK Plc has a dip,
Rest assured, this IS a temporary blip!
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Simon Royston
Managing Director at The Recruitment Lab
In 2022, the British economy went off a cliff and only now are we seeing any signs of recovery. British businesses, like the markets, didn't know how to respond to Liz Truss and her economic hand grenade of a mini-Budget and were left reeling. Thankfully, a degree of order has since been restored with Jeremy Hunt at least able to outline how the British economy was failing. Employers can’t find staff, businesses are struggling to trade with overseas customers and borrowing money is no longer cheap. The UK Government has to start thinking about growth and what’s needed to spark it. Everything right now feels so incredibly fragile and there appears to be no direction and no ideas from the politicians. Politically, this country is rudderless.
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Steven Rowe
Director at Lucent Financial Planning
The small businesses that we work with are upbeat, except those that rely on energy, whose costs have increased substantially. For most, there has not been a problem with their order book, but simply in being able to fulfil it. The lack of recruits with the necessary abilities is the problem and this has forced up their wage bills to retain and attract them. If it's really concerned about the UK's future, the Government should call a General Election. The past few years have produced significant uncertainty for companies. Some of it was externally inflicted, like Covid and the Russian invasion of Ukraine, some self-inflicted, like Brexit and the Conservative merry-go-round of Prime Ministers with rotating policy priorities. No matter who wins the election, it gives us a period of five years with consistent social and economic policy.
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Jordan Price
Operations Director at Castle View Finance
Confidence in the market is improving, which means there are a lot more positive conversations for landlords. Fixed rates are stabilising which is helping landlords understand their options, with some looking to alternate strategies from simple BTL properties to higher-yielding ones like Serviced Accommodation, Holiday lets and HMOs. The main challenges I am noticing are for landlords and the rent they are receiving not fitting the stress testing of lenders. While some lenders can consider top-slicing (whereby a lender will use additional income to help meet the mortgage requirements should there be a shortfall in the rent), this will limit the lending options available to landlords and might put a strain on their plans if they are looking to grow their portfolio this year, as many properties are being sold below asking price.
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Jess Magill
Co-founder at Powderkeg Brewery
As a microbrewery, we have just had our busiest January ever so there's life in the economy yet. We have great plans for the year ahead and are feeling upbeat. But we know lots of hospitality businesses are struggling, cutting opening hours and closing for good, and this has countless knock-on effects on their workers and suppliers. The Government urgently needs to support the hospitality sector, as it's a huge contributor to the economy and a draw for tourism. It also adds to the quality of our lives. Imagine a neighbourhood with no pubs, restaurants or cafes.
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Austyn Johnson
Founder at Mortgages For Actors
Just be a bit more stable! The end of last year was a shambles and people are paying the price for it. People, not numbers and banks, but people. Remember that word with every twist and turn made to policy. Some people can handle all the issues and prices changing constantly, but many cannot. Compassion in politics will go a long way. People are scared of the unpredictable, and this climate is making consumers scared. You can't grow an economy by scaring people into not spending. Be stable and people will be ok with the changes.