British companies fear a “significant decrease” of their trade prospects in the coming months, which causes worries to rise over further job losses and the ambitions of Labor to get economic growth going again.
A survey by the CBI shows that net 22 percent of companies in the private sector expects their production to fall between now and April, which corresponds to the gloomy sentiment of December – the most pessimistic figures in more than two years. Since mid -2022, the activity has remained stable or fallen.
Alpesh Paleja, interim chief economist at the CBI, said: “After a grim run-up to Christmas, the new year did not bring any sense of renewal, whereby companies still expect a significant decrease in activity. Anecdotes suggest that companies are being hit by a moderate demand and caution among consumers, while they also continue to adapt to the measures announced in the budget. ”
The relationship between government and business is under pressure since the budget of last October, in which higher national insurance contributions for employers were introduced. Official figures from last week showed that the workforce is reduced at one of the fastest pace since the 2009 financial crisis.
Analysts say that companies will probably raise their prices again this year, while employment is in danger, especially in business services and consumer -oriented sectors. Separate studies reflect the findings of the CBI, whereby consumer confidence reached the lowest level in a year and companies recorded a lowest point in two years due to optimism.
Despite the promise of Labor to “give the economy an impulse” and to stimulate growth, Chancellor Rachel Rachel Rachel is under increasing pressure from industry now that the taxes for employers will rise in April. Baroness Neville-Rolfe, the Shadow Minister of Finance, has warned that Reeves must “repair part of her lost credit” to companies, by saying: “The Chancellor is looking for problems” with the higher national insurance policy.
The CBI said that negativity is “widely shared” among manufacturers, distributors and professional service providers. “There is an urgent need to get momentum again in the economy,” Paleja added, and urged the government to reform the company rates, adjust the student levy and to expand labor health care to take more people to keep the work and support the growth.