The latest release of the Business Insights and Conditions Survey (BICS) reveals that UK businesses continue to face challenges, but there are small indications of positive improvement in some areas. The survey, conducted fortnightly, provides real-time information to assess the impact of various factors on UK businesses and the economy, including financial performance, workforce, trade, and business resilience.
One notable finding is that approximately two-thirds (65%) of trading businesses reported being able to obtain the materials, goods, or services they needed from within the UK in April 2023, which remains unchanged from March 2023. This stability in domestic supply chains is a positive sign for the resilience of UK businesses.
In terms of concerns, the survey shows a slight decrease in the proportion of businesses expressing worries for June 2023. In May 2023, 68% of businesses reported having some form of concern, down from 71% in the previous month. This decrease represents the lowest percentage reported this year. Notably, concerns related to energy prices dropped from 18% in May 2023 to 15% in June 2023, while worries about inflation of goods and services prices decreased from 16% to 15%.
The survey also indicates that worker shortages have remained relatively stable, with nearly two-thirds (63%) of businesses not experiencing any labor shortages in late May 2023. Meanwhile, 13% of businesses reported having worker shortages, while the remainder selected “not sure” or “not applicable.” This finding suggests that the labor market is maintaining a sufficient supply of workers to meet business needs.
Regarding wages, approximately a quarter (23%) of businesses reported an increase in employees’ hourly wages in April 2023 compared to March 2023. This figure rose to 48% for businesses with 10 or more employees, indicating a positive trend in wage growth for larger organizations.
Industrial action has had a limited impact on businesses, with less than 10% directly or indirectly affected in April 2023. Among those affected, 24% reported being unable to fully operate as a consequence, while 32% cited reasons such as reduced demand for goods and services and a decrease in the number of customers.
The Business Insights and Conditions Survey (BICS) also provides an overview of the overall trading status of businesses. In late May 2023, 95% of businesses reported trading, with 87% fully trading and 8% partially trading. Only 3% of businesses indicated “temporarily paused trading,” while 2% reported “permanently ceased trading.”
When examining exporting and importing activities, 19% of currently trading businesses with 10 or more employees had exported, and 23% had imported within the last 12 months. These businesses were asked to compare their exporting and importing activities in April 2023 with April 2022 and identify any challenges they experienced compared to the previous month.
It is important to note that the data presented in the Business Insights and Conditions Survey (BICS) are estimates and subject to uncertainty due to sampling variability and non-sampling errors. However, these insights provide valuable real-time information for assessing the state of UK businesses and the overall economy.
As the UK economy continues to navigate challenges and uncertainties, these insights from the BICS highlight both the resilience and areas of improvement for UK businesses. Monitoring these trends can help policymakers, businesses, and stakeholders make informed decisions to support economic recovery and growth.