A “record” number of firms say they have reduced headcounts over the last three months as a result of Covid-19 disruption, a major study has revealed.
The research, published by the Federation of Small Businesses (FSB), also highlights that business confidence remains in negative territory for the ninth month in a row.
The findings form part of the FSB’s Small Business Index Study – a monthly barometer of performance from across 1,500 small firms.
According to the report, a “record” one in four (25 per cent) small businesses say they have made redundancies over the last quarter, while a similar number (29 per cent) expect to make redundancies over the coming three months. Worryingly, one in 10 employers expect to see at least a quarter of their team let go.
Revenue growth has also fallen to the lowest level on record, with over half (56 per cent) of businesses reporting a drop, with a similar number (50 per cent) expecting a fall next quarter.
The figures come as the Government’s new Job Support Scheme (JSS) comes into effect from next month.
Replacing the Coronavirus Job Retention Scheme (CJRS), the new initiative will support jobs by covering the costs of at least 66 per cent of employee wages for hours not worked, split into a 61.67 per cent Government contribution and a five per cent employer contribution.
Commenting on the scheme, Federation of Small Businesses (FSB) National Chair Mike Cherry said the JSS will “be yet another vital lifeline to saving jobs and keeping businesses afloat”.
According to the latest statistics, approximately 9.6 million employees were placed on furlough under the CJRS, with the total value of claims reaching £41.4 billion.