A ‘two-speed’ economy is emerging with smaller firms far gloomier than their larger peers, a new report has found.
Just 12 per cent of businesses with fewer than ten staff felt current conditions support long-term growth, while two-thirds of the largest employers did.
Small firms are also turning to costlier short-term borrowing with overdraft usage up 2.5 per cent on the previous year, while bigger firms’ longer‑term borrowing rose 8.7 per cent, suggesting continued investment despite economic uncertainty.
Cost pressure: A ‘two-speed’ economy is emerging with smaller firms far gloomier than their larger peers
The study by Barclays is based on data from a million of its UK corporate clients and research from 1,000 business leaders. Almost all reported ‘intense’ cost pressure, responding by raising their prices again this year.
Higher energy bills troubled all firms, but Abdul Qureshi, who runs Barclays’ business banking arm, noted: ‘Smaller businesses have been operating cautiously, and the pressures they face are clear. Even so, many still see the UK as a place where they can innovate and grow.’
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