Business news 10 May 2023
James Salmon, Operations Director.
SME owners feel isolated due to excessive hours. Firms advised to limit alcohol at work events. Optimism increases among business bosses. Bankers got it wrong on the economy. Permanent hires fall while temp jobs jump. And more business news.
SME owners feel isolated due to excessive hours
Nearly three quarters of SMEs owners feel isolated from their friends and family as a result of the hours they work. A poll of 500 SME leaders and decision makers saw 59% say they can never switch off from their job. The survey found that one in 10 work for at least 50 hours in a typical week and while many say setting their own hours was among reasons for starting their own venture, 44% believe they work more than they should. More than half (53%) said their work is stressful. Steve Hackley, managing director for Sky Business, which commissioned the research, said: “It can be hard work being your own boss. There’s always a temptation to just do one more thing – and these long working hours can very easily lead to burnout.” Despite the concerns, 74% of SME leaders say they could never work for someone else.
Firms advised to limit alcohol at work events
The Chartered Management Institute (CMI) is urging businesses to limit the amount of alcohol served at work social events in order to prevent people from acting inappropriately towards others. The warning comes as the CMI releases a new poll, showing that one in three managers had witnessed harassment or inappropriate behaviour at work events.
Younger people, aged between 16 and 34, were most likely to be in favour of non alcoholic events and all together 42% said work parties should be organised around activities that don’t involve alcohol.
The poll follows soon after the scandal at the CBI where alcohol played a major role in misconduct at CBI events.
Optimism increases among business bosses
Optimism among business leaders has hit the highest level since before last September’s controversial mini-Budget. BDO’s optimism index climbed to 98.22 in April, the highest since August 2022 on an index where a score above 95 is deemed positive.
BDO said that bosses’ optimism had been boosted by “stronger-than-expected” consumer activity. The report also saw the measure of business output climbing to an eight-month high of 99.80, with this driven by the services sector.
While services – which covers retail, financial and leisure companies – made its biggest monthly improvement since January 2022, manufacturing recorded its worst performance since early 2020, in terms of output.
Kaley Crossthwaite, a partner at BDO, said: “A tale of two sectors has emerged,” adding that the resilience of the economy “relies almost solely on the outlook for the improving services sector, as manufacturing businesses face an ongoing downturn.” BDO’s employment index rose for the third consecutive month in April, with this driven by a rise in the number of people in work.
Bankers got it wrong on the economy
Analysts at Citi say they underestimated Britain’s economic prospects, with bankers dismissing an earlier forecast that the pound would drop to parity with the dollar, instead saying sterling could rise towards $1.30 at the start of next year. Vasileios Gkionakis, head of European foreign exchange strategy at Citi, said predictions of a “material correction” in house prices and a collapse in consumption had not come to pass, telling clients in a note: “We have been wrong, plain, and simple.” “The reality is that, while inflation exhibits some idiosyncratic persistence, contrary to what we expected, activity has proven far more resilient,” he added. Analysts at NatWest have also offered a more optimistic view of the pound’s performance, while Goldman Sachs says it has adopted an “outright constructive stance” on sterling.
Ministers will not change BoE’s inflation target
Treasury Minister Andrew Griffith says the Government will not change the Bank of England’s inflation target. He said that while the Treasury would continue to “work closely” with the Bank to “ensure that monetary and fiscal policy are well coordinated”, it has no plans to change the 2% target. Inflation is currently at 10.1% – five times higher than the central bank’s target.
The number of people hired for full-time jobs contracted at the fastest rate in over two years in April, while temporary placements grew at their fastest rate in seven months, according to a monthly poll by the Recruitment and Employment Confederation (REC) and KPMG. The survey saw the number of candidates who said they were looking for new jobs climb for the second month in a row. Starting pay for both temporary and permanent workers increased in April, with firms raising pay in an effort to attract staff with the right skills.
Claire Warnes, partner in skills and productivity at KPMG UK, said: “The preference for hiring short-term staff continued unabated into April. Businesses remain cautious about committing to permanent hires in the face of ongoing economic uncertainty, which led to the quickest increase in temporary billings for seven months.”
REC chief executive Neil Carberry said: “This data shows how uncertain many employers are feeling right now. The good news is that they still need to hire, as growing vacancies show. But firms are hedging their bets.” He noted that April saw permanent hiring “fall back quickly and businesses turn to temps to help them through.”
Consumers buying food near expiry to save money
Analysis by Barclays shows that shoppers are increasingly snapping up food that is close to its expiry date as they try to cut costs as inflation soars. The poll shows that 38% of households bought discounted products nearing their expiry dates in April. This comes as food inflation hit 19.2% in March. An Office for National Statistics report from earlier this year found that a fifth of adults were eating food past its use-by date to cope with financial pressures amid the cost-of-living crisis.
Ryanair
Ryanair has ordered up to 300 Boeing 737 Max-10 planes, as it looks to an increase in post-covid travel. At a cost of $40bn Ryanair would be able to almost double passenger numbers from 168m to 300m.
Twitter
Elon Musk says Twitter users will soon be able to make audio and video calls via the platform, according to , the firm’s boss. Twitter’s owner has already spoken of his desire to make the social media platform the “everything app” that would combine calls, messaging and payments.
House price inflation eases in April
Annual house price inflation has slowed to its weakest level in more than a decade, according to figures from Halifax. The average house price in Britain is now 0.1% higher than a year ago, having fallen by 0.3% to £286,896 in April. The price drop recorded last month followed three successive months of increases. Annual house price inflation, which peaked at 12.5% last year, is now at the lowest rate since December 2012, when the average UK house was worth less than £167,000. Despite the fall, Halifax said the housing market was now “more stable” than it had been for some time. The lender said the gradual easing of mortgage rates in recent months had given “important certainty to would-be buyers.” Kim Kinnaird, Halifax’s director of mortgages, said: “House price movements over recent months have largely mirrored the short-term volatility seen in borrowing costs.”
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The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.