Business Insights And Impact On The UK Economy
21st October 2022
In September 2022, just over a quarter (26%) of trading businesses reported their turnover was lower compared with August 2022, while 14% reported their turnover was higher (a net 12% of businesses saying turnover decreased); the accommodation and food service activities industry reported the largest percentage of businesses whose turnover was lower, at 52%.
In early October 2022, more than a third (35%) of trading businesses reported economic uncertainty was having an impact on their turnover; while one in five (21%) trading businesses expect their turnover to decrease in November 2022.
Of trading businesses, 48% reported an increase in the prices of goods or services bought in September 2022 compared with August 2022, up from 44% reported between July and August 2022.
Energy prices remain the top reason businesses are considering raising their prices in November 2022 with 39% of trading businesses reporting this; the accommodation and food service activities industry reported the largest proportion, at 75%.
In early October 2022, 41% of businesses reported they had either no cash reserves (13%) or had three months or less (28%); this is the highest percentage reported since late June 2021.
A quarter (25%) of businesses reported their performance had decreased in September 2022 compared with September 2021.
Turnover
More than half (52%) of trading businesses in the accommodation and food service activities industry reported that their turnover was lower in September 2022 compared with August 2022. This was 18 percentage points higher than any other industry and an increase of 9 percentage points from those who reported turnover was lower in August 2022 when compared with July 2022.
When asked in early August 2022 about their expectations for turnover in September 2022, 16% of trading businesses reported they expected their turnover to decrease. Actual data suggest, 26% of businesses reported turnover did decrease.
Turnover challenges
Trading businesses were then asked about the challenges that may have affected their businesses' turnover.
In early October 2022, more than a third (35%) of businesses reported that economic uncertainty was having the biggest impact on their turnover. This is up from the 28% of businesses who reported this challenge in early July 2022.
Other challenges that businesses reported were having an impact were:
cost of materials, at 29%
cost of labour, at 17%
financial costs, at 16%
The accommodation and food service activities industry reported the highest proportion of businesses who are being affected by these challenges. This industry also reported the lowest percentage of businesses not experiencing any challenges, at 7%.
In comparison, 26% of trading businesses reported they were not currently experiencing any challenges, down slightly from 28% reported in early July 2022.
Further details including all response options broken down by industry and size band are available in our accompanying dataset.
Turnover Expectations
One in five (21%) trading businesses expect their turnover to decrease in November 2022, which is up slightly from 19% of businesses in October 2022.
Nearly half (49%) of businesses in the accommodation and food service activities industry expect their turnover to decrease in November 2022. This was driven by the food and beverage service activities sub-industry.
The real estate activities industry followed, with 31% of businesses expecting turnover to decrease in November 2022. Looking at current challenges, 42% of businesses in this industry reported economic uncertainty as their top challenge.
Prices
In September 2022, 48% of trading businesses reported the prices of goods or services bought had increased compared with the previous month. This compares with 44% of businesses who reported an increase in the prices of goods or services bought in August 2022. For prices sold, these percentages were 21% and 20%, across the same period.
Businesses were asked what, if anything, was causing them to consider raising their prices. More than half (57%) of businesses reported one or more reasons why they would be considering raising their prices. Energy prices continued to be reported as the top reason businesses are considering raising their prices in November 2022, with 39% of businesses reporting this, while 34% reported they are not considering raising prices.
Staffing Costs
In early October 2022, 49% of not permanently stopped trading businesses with 10 or more employees reported an increase in staffing costs, with the other service activities industry reporting the highest proportion, at 64%.
For businesses with 10 or more employees, the human health and social work activities industry (private sector businesses only) reported the highest proportion of businesses who expect staffing costs to increase in the next three months, at 59%.
Cash Reserves
Table of contents
Main points
Headline figures
Financial performance
Prices
Cash reserves
Business performance
Business Insights and Conditions Survey data
Glossary
Measuring the data
Strengths and limitations
Related links
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1.Main points
In September 2022, just over a quarter (26%) of trading businesses reported their turnover was lower compared with August 2022, while 14% reported their turnover was higher (a net 12% of businesses saying turnover decreased); the accommodation and food service activities industry reported the largest percentage of businesses whose turnover was lower, at 52%.
In early October 2022, more than a third (35%) of trading businesses reported economic uncertainty was having an impact on their turnover; while one in five (21%) trading businesses expect their turnover to decrease in November 2022.
Of trading businesses, 48% reported an increase in the prices of goods or services bought in September 2022 compared with August 2022, up from 44% reported between July and August 2022.
Energy prices remain the top reason businesses are considering raising their prices in November 2022 with 39% of trading businesses reporting this; the accommodation and food service activities industry reported the largest proportion, at 75%.
In early October 2022, 41% of businesses reported they had either no cash reserves (13%) or had three months or less (28%); this is the highest percentage reported since late June 2021.
A quarter (25%) of businesses reported their performance had decreased in September 2022 compared with September 2021.
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2.Headline figures
The data presented in this bulletin are the final results from Wave 67 of the Business Insights and Conditions Survey (BICS), which was live from 3 October to 16 October 2022.
Experimental single-site weighted regional estimates up to Wave 60 (27 June to 10 July 2022) are available in our Business insights and impact on the UK subnational single-site economy: July 2022 article.
Please note that businesses were asked to exclude seasonal changes when answering questions contained within BICS.
More about economy, business and jobs
All ONS analysis, summarised in our economy, business and jobs roundup.
Explore the latest trends in employment, prices and trade in our economic dashboard.
View all economic data.
Figure 1: Headline figures from the Business Insights and Conditions Survey
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Notes:
For presentational purposes, some response options have been excluded.
Prices: for presentational purposes, the data show an increase to prices bought and sold compared with the previous calendar month.
Workforce: the data for the equivalent period last year are not available as the question was not asked for this time period.
Data are plotted in the middle of each wave.
Download the data
.xlsx
In early October 2022, the percentage of businesses that reported they were trading was 95%, with 85% fully trading and 10% partially trading (for example, trading with reduced hours or staff numbers). Meanwhile, 4% of businesses reported "temporarily paused trading" and 1% "permanently ceased trading" as their business's trading status.
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3.Financial performance
Turnover
Trading businesses were asked how their turnover in September 2022 compared with August 2022.
Figure 2: A net 12% of trading businesses reported their turnover was lower in September 2022
Impact on turnover, businesses currently trading, broken down by industry, weighted by count, UK, 1 to 30 September 2022
Turnover decreasedTurnover stayed the sameTurnover increasedNot sureAccommodation and food service activitiesWholesale and retail trade; repair of motor vehicles and motorcyclesManufacturingEducationOther service activitiesConstructionProfessional scientific and technical activitiesHuman health and social work activitiesArts entertainment and recreationAdministrative and support service activitiesInformation and communicationReal estate activitiesTransportation and storageAll industries020406080100%
Source: Office for National Statistics - Business Insights and Conditions Survey
Notes:
Bars may not sum to 100% because of rounding and percentages less than 1% being removed for disclosure purposes.
"Mining and quarrying" and "Water supply, sewerage, waste management and remediation activities" have been removed for disclosure purposes, but their totals are included in "All industries".
Download this chartFigure 2: A net 12% of trading businesses reported their turnover was lower in September 2022
Image .csv .xls
More than half (52%) of trading businesses in the accommodation and food service activities industry reported that their turnover was lower in September 2022 compared with August 2022. This was 18 percentage points higher than any other industry and an increase of 9 percentage points from those who reported turnover was lower in August 2022 when compared with July 2022.
When asked in early August 2022 about their expectations for turnover in September 2022, 16% of trading businesses reported they expected their turnover to decrease. Actual data suggest, 26% of businesses reported turnover did decrease.
Turnover challenges
Trading businesses were then asked about the challenges that may have affected their businesses' turnover.
In early October 2022, more than a third (35%) of businesses reported that economic uncertainty was having the biggest impact on their turnover. This is up from the 28% of businesses who reported this challenge in early July 2022.
Other challenges that businesses reported were having an impact were:
cost of materials, at 29%
cost of labour, at 17%
financial costs, at 16%
The accommodation and food service activities industry reported the highest proportion of businesses who are being affected by these challenges. This industry also reported the lowest percentage of businesses not experiencing any challenges, at 7%.
In comparison, 26% of trading businesses reported they were not currently experiencing any challenges, down slightly from 28% reported in early July 2022.
Further details including all response options broken down by industry and size band are available in our accompanying dataset.
Turnover expectations
Trading businesses were then asked about their turnover expectations for November 2022.
Figure 3: More than one in five (21%) of trading businesses reported they expect their turnover to decrease in November 2022
Turnover expectations, businesses currently trading, broken down by industry, weighted by count, UK, 1 to 30 November 2022
Expect turnover to decreaseExpect turnover to stay the sameExpect turnover to increaseNot sureAccommodation and food service activitiesReal estate activitiesWholesale and retail trade; repair of motor vehicles and motorcyclesEducationAdministrative and support service activitiesConstructionProfessional scientific and technical activitiesInformation and communicationManufacturingOther service activitiesArts entertainment and recreationTransportation and storageHuman health and social work activitiesAll industries020406080100%
All industries
● Not sure: 13.5
● Expect turnover to increase: 11.9
● Expect turnover to stay the same: 53.4
● Expect turnover to decrease: 21.2
Source: Office for National Statistics - Business Insights and Conditions Survey
Notes:
Bars may not sum to 100% because of rounding and percentages less than 1% being removed for disclosure purposes.
"Mining and quarrying" and "Water supply, sewerage, waste management and remediation activities" have been removed for disclosure purposes, but their totals are included in “All industries”.
Download this chartFigure 3: More than one in five (21%) of trading businesses reported they expect their turnover to decrease in November 2022
Image .csv .xls
One in five (21%) trading businesses expect their turnover to decrease in November 2022, which is up slightly from 19% of businesses in October 2022.
Nearly half (49%) of businesses in the accommodation and food service activities industry expect their turnover to decrease in November 2022. This was driven by the food and beverage service activities sub-industry.
The real estate activities industry followed, with 31% of businesses expecting turnover to decrease in November 2022. Looking at current challenges, 42% of businesses in this industry reported economic uncertainty as their top challenge.
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4.Prices
Prices bought and sold
Figure 4: Nearly half (48%) of trading businesses reported an increase in the prices of goods or services bought in September 2022
Prices bought and sold increased, businesses currently trading, broken down by industry, weighted by count, UK, 1 to 30 September 2022
Prices bought increasedPrices sold increasedAccommodation and food service activitiesWholesale and retail trade; repair of motor vehicles and motorcyclesManufacturingConstructionOther service activitiesAdministrative and support service activitiesEducationTransportation and storageReal estate activitiesProfessional scientific and technical activitiesArts entertainment and recreationHuman health and social work activitiesInformation and communicationAll industries020406080100%
Source: Office for National Statistics - Business Insights and Conditions Survey
Notes:
For presentational purposes response options have been removed.
“Mining and quarrying” and “Water supply, sewerage, waste management and remediation activities” have been removed for disclosure purposes, but their totals are included in “All industries”.
Download this chartFigure 4: Nearly half (48%) of trading businesses reported an increase in the prices of goods or services bought in September 2022
Image .csv .xls
In September 2022, 48% of trading businesses reported the prices of goods or services bought had increased compared with the previous month. This compares with 44% of businesses who reported an increase in the prices of goods or services bought in August 2022. For prices sold, these percentages were 21% and 20%, across the same period.
Businesses were asked what, if anything, was causing them to consider raising their prices. More than half (57%) of businesses reported one or more reasons why they would be considering raising their prices. Energy prices continued to be reported as the top reason businesses are considering raising their prices in November 2022, with 39% of businesses reporting this, while 34% reported they are not considering raising prices.
Further details including all response options broken down by trading status, industry and size band are available in our accompanying dataset.
Staffing costs
Businesses not permanently stopped trading were asked how their business's staffing costs have changed over the last three months and how they expect them to change over the next three months.
Figure 5: Nearly half (49%) of businesses not permanently stopped trading with 10 or more employees reported an increase in staffing costs over the last three months
Staffing costs, businesses not permanently stopped trading with 10 employees or more, broken down by industry, weighted by count, UK, 3 to 16 October 2022
Last 3 months for all sized businesses excl 0 to 9Next 3 months for all sized businesses excl 0 to 9Costs have or will increaseCosts have or will stay the sameCosts have or will decreaseNot sureNot applicable0102030405060%
Source: Office for National Statistics - Business Insights and Conditions Survey
Notes:
For presentational purposes, some response options have been removed.
Download this chartFigure 5: Nearly half (49%) of businesses not permanently stopped trading with 10 or more employees reported an increase in staffing costs over the last three months
Image .csv .xls
In early October 2022, 49% of not permanently stopped trading businesses with 10 or more employees reported an increase in staffing costs, with the other service activities industry reporting the highest proportion, at 64%.
For businesses with 10 or more employees, the human health and social work activities industry (private sector businesses only) reported the highest proportion of businesses who expect staffing costs to increase in the next three months, at 59%.
Further details including all response options broken down by trading status, industry and size band are available in our accompanying dataset.
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5.Cash reserves
Figure 6: More than half of businesses (51%) in the education industry (private sector and higher education businesses), have three months or less of cash reserves
Cash reserves, businesses not permanently trading, broken down by industry, weighted by count, UK, 3 to16 October 2022
Business has no cash reserves3 months or lessMore than 3 monthsNot sureEducationTransportation and storageConstructionAdministrative and support service activitiesAccommodation and food service activitiesWholesale and retail trade; repair of motor vehicles and motorcyclesOther service activitiesProfessional scientific and technical activitiesInformation and communicationArts entertainment and recreationManufacturingHuman health and social work activitiesReal estate activitiesAll industries020406080100%
Source: Office for National Statistics - Business Insights and Conditions Survey
Notes:
Bars may not sum to 100% because of rounding and percentages less than 1% being removed for disclosure purposes.
For presentational purposes response options have been combined.
“Mining and quarrying” and “Water supply, sewerage, waste management and remediation activities” have been removed for disclosure purposes, but their totals are included in “All industries”.
When referring to the education industry, we sample private sector and higher education businesses only.
Download this chartFigure 6: More than half of businesses (51%) in the education industry (private sector and higher education businesses), have three months or less of cash reserves
Image .csv .xls
In early October 2022, the education industry (private sector and higher education businesses only) had the largest proportion of businesses reporting having three months or less cash reserves, including no cash reserves, at 51%.
The administrative and support service activities industry reported the largest increase in the proportion of businesses reporting having no cash reserves or three months or less, up 9 percentage points from 35% reported in early July 2022.
Business Performance
Of businesses not permanently stopped trading, 25% reported their overall performance including pricing, trading and workforce had decreased in September 2022 compared with September 2021. Over the same period, almost half (47%) of businesses in the accommodation and food service activities industry reported their performance had decreased. However, when excluding businesses with fewer than 10 employees, the proportion of businesses reporting a decrease was 40%.
In contrast the proportion of businesses reporting their performance will decrease over the next 12 months was 17%, with 18% expecting their performance to increase. Businesses within the accommodation and food service activities industry reported the largest proportion of businesses expecting their performance to decrease over the next 12 months, at 43%.
Note
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