Intuit QuickBooks Small Business Index, July 2023

-3,800 jobs | -2.68%

In the UK in June, small businesses with one to nine employees had 3,800 fewer job vacancies nationally. That’s a monthly decrease of 2.68% to 139,200 vacancies compared to the previous official benchmark of 143,000 in May’s Vacancy Survey, published by the Office for National Statistics.* 

This is the fifth consecutive month since the Intuit QuickBooks Small Business Index launch, in March 2023, that the number of job vacancies at small businesses has fallen. 

Transport and storage sector has fastest fall in small business vacancies

In total, 7 out of the 13 sectors covered by the Index had fewer job vacancies in June compared to May. The three sectors where hiring has fallen fastest are:

• Transport and storage (UK SIC H): with a drop of 6.03%, equivalent to 600 fewer vacancies compared to May. This sector covers both passenger and goods transport.

• Accommodation and food services (UK SIC I): with a drop of 5.39%, equivalent to 500 fewer vacancies. This sector includes hotels, pubs and restaurants. 

• Construction (UK SIC F): with a drop of 3.63%, equivalent to 100 fewer vacancies. This sector includes both residential and commercial construction.

Education leads sectors creating the most small business jobs

The remaining six sectors all created jobs in June — with education leading the pack. The top three sectors where hiring has been rising fastest are:

• Education (UK SIC P): up by 2.78%, equivalent to 400 extra job vacancies compared to May. This sector covers adult education and professional training in addition to primary, secondary, higher and further education.

• Real estate (UK SIC L): up by 1.91%, equivalent to 100 extra job vacancies. This sector includes everything related to buying, selling or renting land and buildings. 

Arts, entertainment, and recreation (SIC R) (UK SIC R): up by 1.26%, equivalent to 100 extra job vacancies. This sector includes museums and attractions, sports clubs and gyms, as well as the creative arts, theatre and live performance.

Small business hiring falls fastest in England

Small business hiring fell in both England and Wales in June, down by 3.48% and 0.16% respectively. In England, this means 4,400 fewer job vacancies being advertised compared to the month before. Go north, however, and it’s a different story. In Scotland, small business hiring is up by 3.14%. In Northern Ireland, it’s up by 3.23%.

Ufuk Akcigit, the Arnold C. Harberger Professor of Economics at the University of Chicago, said: “To address the rising inflation, the Bank of England has steadily increased the Policy Rate since December 2021. Despite these efforts, the inflation rate has remained persistently high. In May, the Consumer Price Index reached 8.7%, prompting the Monetary Policy Committee of the Bank of England to raise the base rate by an additional 0.5%, bringing it to 5%, the highest level in 15 years. While this decision aims to curb inflation, it has put pressure on small businesses making it more difficult to access capital. This is observed from the 2.68% decline in job vacancies, as indicated by the Intuit QuickBooks Small Business Index, marking the fifth consecutive decline since its launch in March 2023.

“The inflationary pressure has affected different consumption sectors in varying ways. The sharpest 12-month price increase was observed in the ‘food and non-alcoholic beverages’ category, with a rise of 18.3%. Following closely behind was the ‘housing and household services’ category, experiencing a 12.1% increase. In parallel, the Intuit QuickBooks Small Business Index revealed one of its largest contractions in the ‘accommodation and food service activities’ sector, with a decline of 5.4%. This sector has consistently experienced negative contractions since the launch of the index in March 2023. This implies that this small business sector has experienced dual pressures of high inflation and declines in employment, and further underscores the need for attention and support to mitigate the challenges they face.

“The prevailing issue in the UK economy continues to be high inflation. While the United States and Canada have seen inflation fall to 4% and 4.3% respectively, the UK remains at 8.7%. Addressing this challenge will undoubtedly be a complex and ongoing process. To effectively tackle inflation, it is crucial to closely examine the state of small businesses, as they are particularly vulnerable to adverse macroeconomic conditions. Their health and resilience serve as crucial indicators of the overall economic well-being. Therefore, a comprehensive analysis of small businesses becomes imperative in the battle against inflation in the UK economy.”

Get all the details from the interactive Small Business Index dashboard.

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USA Index

The Intuit QuickBooks Small Business Index is also published monthly in the US. Get the latest small business employment insights for the US here. 

Canada Index

The Intuit QuickBooks Small Business Index is also published monthly in Canada. Get the latest small business employment insights for Canada here.

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