Red tape still hindering SMEs, study reveals
FSB biennial survey shows small firms still being held back
Skills, red tape and crime are the main barriers to small business growth, the Federation of Small Businesses’ (FSB) 2006 survey of its membership has revealed.
With a total of 18,939 responses, the FSB's survey, which is conducted every two years, is among the largest non-government business surveys in the UK.
When questioned about red tape, 56 per cent of respondents reported an increase in time spent on regulation, 27 per cent reported no change and less than 1 per cent reported a decrease. Also 55 per cent said they were unhappy about the complexity of legislation – 53 per cent because of the volume and 51 per cent because of the cost of complying with it.
A quarter of all businesses reported encountering one or more skills barriers when seeking to recruit new employees, such as literacy, numeracy, technical skills or communication skills, and 57 per cent of small firms have been the victim of at least one crime in the past year.
John Walker, FSB national policy chairman, said: “Over 97 per cent of UK businesses have less than 20 employees. Small firms make up over 50 per cent of the private sector workforce, some 13 million workers, and generate over half of the UK’s GDP. These problems, which our survey confirms yet again, must therefore be addressed by the government because our country’s economic health depends on the success of small businesses."
“Regulation, both its volume and complexity, crime and a poorly skilled workforce are issues that we have raised many times before. It is therefore worrying that they are still the main barriers to growth for small firms. It demonstrates that action taken so far has been inadequate. We will therefore call on the government in our discussions to do more to lift these barriers and open up the way for small businesses to prosper," he added.