More than half of UK firms have no plans to create new jobs in the year ahead, with one in five saying trading conditions have deteriorated in the last 12 months.
Those are the findings of the latest Close Brothers Business Barometer, which surveys SME owners across the UK and Ireland on a range of economic and financial issues.
It found that just over a quarter will recruit in the next 12 months, with only 12% of those businesses intending to hire permanent members of staff.
The Close Brothers Business Barometer also revealed some positive news, indicating that 95% of businesses polled are not currently planning any job losses within the coming year.
CEO of Close Brothers Invoice Finance, David Thomson, said:
“When so many firms out there are still struggling, it’s little wonder that job creation is weak.
“However it is our workforce that will continue to drive the economy forward and ensure firms are equipped to grasp opportunities as they arise. We have a wealth of new talent in the UK – talent that has made us the top destination for inward investment in Europe last year*. We must find a way to embrace this.
“Cash flow issues remain a major obstacle to firms wishing to consolidate and grow and this is having a knock-on effect on the economy’s recovery as a whole.
“We understand that access to funding is a key driver for growth and that’s why we are working with firms across the country to raise awareness of all the viable funding options open to them.
“It’s good news that the majority of jobs are secure for the time being but UK firms need to do more to plan ahead and invest in the future.”
