The results of the November 2024 Moore UK Owner Managed Business (OMB) survey, conducted immediately after the UK Autumn Budget, reveal a blend of optimism and caution among business leaders. With confidence levels remaining high,
OMBs remain resilient in the face of ongoing economic challenges. However, rising costs, taxation and recruitment pressures are key areas of concern.
High confidence levels
Despite economic uncertainties, the survey highlights robust optimism among OMBs. 79% of businesses expressed confidence in the general outlook for the year ahead, while 81% reported confidence in meeting profit targets – an all-time high since the survey’s inception in February 2021. These figures underscore the adaptability and determination of UK businesses navigating a complex economic environment.
Tax becoming more of a concern
The survey also sheds light on growing challenges. Tax has become a significantly heightened concern, with 37% of respondents identifying it as a key issue, up from 21% in December 2023.
Business costs, tax and rising interest rates emerged as the top three challenges facing OMBs, underscoring the pressure on profitability. Inflation remains a critical concern (32%), despite the recent fall in the UK’s inflation rate, suggesting businesses are still grappling with higher operating costs.
Recruitment and workforce challenges
Recruitment remains a challenge, with only 44% of businesses planning to increase their headcount in the next three months. This cautious approach reflects concerns about affordability following the government’s announcement of increases in the National Minimum Wage and employers’ National Insurance contributions. For many OMBs, these rising costs limit their ability to invest in business growth, indicating potential constraints on job creation.
The survey also revealed a split in perceptions about how recent Budget changes would impact recruitment. While 28% believe the changes will make it easier to hire, a similar number (29%) expect recruitment to become harder. Additionally, 38% of respondents stated that increased business costs would hinder their ability to offer pay rises to existing employees, potentially affecting employee retention and morale.
Mixed reactions to the Autumn Budget 2024
The Autumn Budget received a mixed response from OMBs. While 45% of respondents believe the changes announced will positively impact their business, 31% foresee a negative impact. The increase in Employers’ National Insurance in particular, was flagged as a significant concern, with 44% of businesses stating it would negatively affect their operations.
Trade with Europe: a glimmer of hope?
OMBs are optimistic about trade with Europe. A majority (58%) expressed confidence that trade with the EU will become easier over the next 12 months. This sentiment may reflect recent efforts to streamline post-Brexit trade regulations, offering a potential boost for businesses reliant on European markets.
Balancing optimism with realism
The survey paints a picture of a resilient yet cautious sector. Record levels of confidence in profit targets and overall outlook suggest OMBs are optimistic about their ability to adapt and thrive. However, rising costs, taxation and recruitment challenges present hurdles that could temper growth.
As businesses navigate the implications of the Autumn Budget, policymakers must balance fiscal measures with the need to support OMBs in managing costs and fostering growth. Sustaining high levels of confidence will require continued efforts to address these key concerns while maintaining a favourable environment for trade and investment.
OMBs remain a vital pillar of the UK economy. With strategic support and targeted interventions, they are well-positioned to meet the challenges of 2025 while driving innovation and growth in the post-pandemic era.
To gather the data for this report, we surveyed 520 businesses with turnover between £1m and £30m in November 2024, immediately after the UK Budget. Businesses were selected from across all sectors throughout the UK and in proportion regionally in line with ONS statistics for VAT registered and PAYE companies under 249 employees.
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