Confidence levels amongst Britain’s entrepreneurs have taken a knock during the course of 2007, according to the latest results from the Small Business Confidence Index by Bank of Scotland Business Banking.
The index, which measures small business optimism across five economic areas, reveals a sharp fall in confidence levels of six points since April 2007. The index (which runs from 0 to 100, where 0 is completely pessimistic and 100 is completely optimistic) shows that confidence amongst smaller businesses has fallen from 48 in the second quarter of the year to 42 in the fourth quarter.
A decline in the overall confidence indicator is reflected in key findings from the research, which revealed only 33 per cent of small business owners believe that now is a good time to be running a small business in Britain, compared to 38 per cent who think the opposite.
In addition, 63 per cent of small business owners now expect general economic conditions to worsen over the next 12 months. And given the uncertainty surrounding current market conditions, 45 per cent of entrepreneurs are nervous about the prospects for small businesses in Britain. Only 25 per cent remain confident.
“The economic uncertainty that has dominated the news agenda throughout the latter half of 2007 has clearly filtered down to Britain’s small business community,” says Ivan Matviak, head of Bank of Scotland Business Banking.
“Whilst there are still some healthy growth expectations amongst a significant proportion of these owner-managers, the vast majority are undoubtedly taking a more cautious approach when assessing both their own business prospects and the outlook for economic conditions over the coming year.”