The Federation of Small Businesses (FSB) has warned that rising prices and rail fare hikes threaten to stifle small firms’ recovery from the coronavirus (COVID-19) pandemic.
Responding to data published by the Office for National Statistics (ONS) that showed that the Retail Prices Index (RPI) reached 3.8% and the headline rate of input prices hit growth of 9.9% in July, the FSB said that inflationary pressure is likely to suppress small businesses’ recovery.
The business group also stated that operating costs are up year on year for many small firms, with inputs, labour and utilities all cited as major contributors to the rise.
Mike Cherry, National Chairman of the FSB, said: ‘With firms now having to manage debt repayments, rent arrears, business rates and skills shortages on top of rising prices, the government should move swiftly to mitigate the effects of soaring costs.
‘Bringing down employer national insurance contributions (NICs) – which serve as a jobs tax in an environment where many are struggling to recruit – would be a good starting point.’