Business Insights And Impact On The Uk Economy

23rd April 2024

The latest results suggest business conditions remain challenging but estimates since January 2024 show small signs of improvement for some measures.

More than one in five (22%) trading businesses reported that their turnover had decreased in March 2024 compared with February 2024, while 16% reported their turnover had increased; these figures are broadly stable with February 2024.

In early April 2024, 21% of trading businesses reported that they expect their turnover to increase in May 2024, broadly stable with expectations for April 2024.

Nearly a quarter (24%) of trading businesses reported an increase in the prices of goods or services bought in March 2024, compared with February 2024; less than 1 in 10 (9%) said they had increased prices sold over the same period.

Nearly half (49%) of trading businesses reported they were not considering raising prices in May 2024; labour cost (24%) was reported as the top reason for businesses considering doing so, both these figures are broadly stable with April 2024.

In early April 2024, nearly a quarter (24%) of trading businesses reported they expect their overall performance to increase over the next 12 months, broadly stable with early February 2024.

Turnover
Trading businesses were asked how their turnover in March 2024 compared with February 2024, excluding any seasonal trading.

More than one in five (22%) trading businesses reported that their turnover had decreased in March 2024 compared with February 2024.

Nearly a quarter (24%) of trading businesses reported that the prices of goods or services they bought had increased in March 2024 compared with the previous calendar month, broadly stable when comparing February 2024 with January 2024. While prices sold also remained broadly stable at 9%, this was the lowest proportion reported since this response option was introduced in March 2022. These proportions remain lower than those reported in January 2024 (26% and 12%, respectively).

When asked in early April 2024, the proportion of businesses that expect the prices of goods or services they sell to rise in May 2024 was 16%, down 3 percentage points from expectations for April 2024. The proportion of businesses that expect prices to stay the same was 62%, up 4 percentage points over the same period, while those who expect the prices to decrease was 2%.

Businesses were also asked which factors, if any, were causing them to consider raising prices in May 2024. The most reported reason for businesses considering doing so was labour costs (24%), which, although broadly stable from April 2024, is at its highest level since June 2023 (26%). Many businesses cited the increase in the National Living Wage as the reason they selected this response option.

The proportion of businesses with 10 or more employees who reported experiencing global supply chain disruption in March 2024 was 6%, broadly stable with February 2024.

Of those businesses, 41% reported the conflict in the Middle East as the main reason for their disruption, down 9 percentage points from February 2024. The other most reported reasons included:

the UK exiting the EU (19%), up by 11 percentage points

a shortage of materials (12%), broadly stable

Read the full ONS report HERE