According to the Institute of Chartered Accountants in England and Wales (ICAEW), over one fifth of all UK businesses have above normal stock levels due to a decrease in customer demand in light of the 20% VAT hike.
Pay expectations for the coming year are predicted at an unpromising 2% increase- yet another deterrent for possible customers.
Experts agree that in order to stabilize a floundering economy, the government needs to be encouraging businesses to grow.
Chief executive of the ICAEW Michael Izza said: “At the moment, it is hard to see where this growth will come from and the Chancellor needs to use the forthcoming budget to give businesses reasons to be more confident about the future – and unlock potential investments.”
The report also shows that small and medium sized businesses are more likely to employ new workers than large firms over the next year.
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