Business insights and impact on the UK economy: 17 November 2022

The impact of challenges facing the economy and other events on UK businesses. Based on responses from the voluntary fortnightly business survey (BICS) to deliver real-time information to help assess issues affecting UK businesses and economy, including financial performance, workforce, trade, and business resilience.

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Contact:
Email Gemma Rabaiotti

Release date:
17 November 2022

Next release:
1 December 2022

1. Main points

  • In October 2022, a quarter (25%) of trading businesses reported turnover was lower compared with September 2022, while 15% reported their turnover was higher (a net 11% of businesses reporting turnover decreased).

  • In early November 2022, nearly a quarter (24%) of trading businesses reported that they expect their turnover to decrease in December 2022, while 13% expect their turnover to increase (a net 11% of businesses expect their turnover to decrease).

  • Nearly half (46%) of trading businesses reported an increase in the price of goods or services bought in October 2022 compared with September 2022.

  • In early November 2022, the proportion of trading businesses reporting their performance will decrease over the next 12 months was 16%, broadly stable with early October 2022.

  • Nearly three-quarters (72%) of businesses in the accommodation and food service activities industry reported that their production and/or suppliers have been affected by the recent increases in energy prices, in early November 2022.

  • In early November 2022, 11% of businesses with 10 or more employees reported that they were using, or intending to use, increased homeworking as a permanent business model; improved staff well-being was reported as the main reason for doing so, at 76%.

  • Nearly one in five (19%) businesses reported that domestic demand for goods and services in October 2022 decreased compared with the previous calendar month, broadly stable with September 2022; in contrast nearly half (45%) reported domestic demand stayed the same.

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2. Headline figures

The data presented in this bulletin are the final results from Wave 69 of the Business Insights and Conditions Survey (BICS), which was live from 31 October to 13 November 2022. The data reported within BICS bulletins and datasets are estimates that are subject to uncertainty, for example, sampling variability and non-sampling error. Further information on quality is available in our Business insights and conditions Quality and Methodology Information (QMI) and we regularly update confidence intervals associated with the survey questions.

Experimental single-site weighted regional estimates up to Wave 60 (27 June to 10 July 2022) are available in our Business insights and impact on the UK subnational single-site economy: July 2022 article.

Please note that businesses were asked to exclude seasonal changes when answering questions contained within the BICS.

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Figure 1: Headline figures from the Business Insights and Conditions Survey

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Notes:
  1. For presentational purposes, some response options have been excluded.
  2. Prices: for presentational purposes, the data show an increase to prices bought and sold compared with the previous calendar month.
  3. Data are plotted in the middle of each wave.
Download the data

.xlsx

In early November 2022, the percentage of businesses that reported they were trading was 94%, with 85% fully trading and 9% partially trading (for example, trading with reduced hours or staff numbers). Meanwhile, 5% of businesses reported “temporarily paused trading” and 2% “permanently ceased trading” as their business’s trading status.

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3. Financial performance

Turnover

Trading businesses were asked how their turnover in October 2022 compared with September 2022.

The transportation and storage industry reported a 22 percentage-point increase in the proportion of businesses reporting their turnover was lower in October 2022 compared with the previous calendar month with the figure now at 33%. This change was partially driven by the freight transport by road sub-industry.

The next-largest movement came in the other service activities industry, up 16 percentage points to 43% for the same period. This was being partially driven by the hairdressing and other beauty treatment sub-industry.

Businesses within the hairdressing and other beauty treatment sub-industry commented that they were experiencing lower demand for their services and that their clients were rebooking over longer periods because of the cost of living crisis and financial hardship.

Turnover expectations

Trading businesses were asked about their turnover expectations for December 2022, excluding any seasonality trading.

In early November 2022, 24% of trading businesses within the other service activities industry reported that they expect their turnover to increase in December 2022. This was also being partially driven by the hairdressing and other beauty treatment sub-industry.

In comparison, nearly a quarter (24%) of all trading businesses expect their turnover to decrease in December 2022. The real estate activities industry reported the largest proportion, at 42%, up from the 31% that reported an expected turnover decrease for November 2022 when asked in early October 2022.

Businesses within the real estate industry commented that they have found the increase in interest rates was starting to have an effect on some agreed deals, particularly sales.

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4. Prices

Prices bought and sold

In October 2022, 46% of trading businesses reported the prices of goods or services bought had increased compared with the previous month. This compares with 48% of businesses who reported an increase in the prices of goods or services bought in September 2022. For prices sold, these percentages were 20% and 21%, across the same periods.

The data suggest that some businesses are experiencing a continued increase in prices bought and sold month on month.

Price expectations

Of trading businesses, less than a quarter (22%) expect the prices of the goods or services they sell to increase in December 2022. For businesses with 10 or more employees, this percentage was 25%.

Of those businesses who are considering raising prices, energy prices continued to be reported as the most common reason for doing so, at 38% for businesses of all sizes and 46% for businesses with 10 or more employees. In contrast, more than a third of businesses of all sizes (40%) were not considering raising their prices.

Further response options on prices questions broken down by industry and size band can be found in our accompanying dataset.

Price rises

In early November 2022, businesses not permanently stopped trading were asked in which ways, if any, had they been affected by price rises.

Just over three in five (61%) businesses reported they had been affected in some way. The most commonly reported effects were:

  • having to absorb costs (39%); the accommodation and food service activities industry reported the highest proportion (59%)

  • having to pass on price increases to customers (28%); the manufacturing industry reported the highest proportion (49%)

  • having to change suppliers (12%); the accommodation and food service activities industry reported the highest proportion (26%)

More than a quarter (27%) of businesses selected, "The business has not been affected by price rises". The information and communication industry reported the highest proportion (49%) while the accommodation and food service activities industry reported the lowest proportion (4%).

Further details including the full list of effects broken down by industry and size band are available in our accompanying dataset.

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5. Energy prices

In early November 2022, 31% of not permanently stopped trading businesses reported their production and/or suppliers had been affected by the recent increase in energy prices, broadly stable with early October 2022. For businesses with 10 or more employees, this percentage was 43%.

Further details including the full list of concerns broken down by industry and size band are available in our accompanying dataset.

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6. Domestic demand

Of businesses not permanently stopped trading, 19% reported that domestic demand for goods and services had decreased in October 2022 compared with the previous calendar month, down from 20% reported for September 2022.

The transportation and storage industry recorded the largest rise in the proportion of businesses reporting that domestic demand for goods and services had decreased in October 2022 compared with the previous month, up from 3% to 17%.

Further response options broken down by industry and size band can be found in the accompanying dataset.

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7. Workforce

In early November 2022, businesses not permanently stopped trading were asked whether their business was using, or intending to use, increased homeworking as a permanent business model in the future.

In early November 2022, the percentage of businesses with 10 or more employees who reported that they were using, or intending to use, increased homeworking as a permanent business model was 11%. This remained broadly stable compared with early August 2022, but was down from 19% in early June 2022.

Of businesses that reported using, or intending to use, increased homeworking as a permanent business model, 76% reported improved staff well-being as the reason for doing so, broadly stable from early June 2022. However, this was down from 85% for the same reference period this time last year.

Other reasons reported by businesses were:

  • ability to recruit from a wider geographical pool in the UK, at 45%; up from 40% in early June 2022

  • increased productivity, at 37%; down from 40% in early June 2022

In contrast, 58% of businesses with 10 or more employees reported they were not using, or intending to use, increased homeworking as a permanent business model. Over four in five (81%) of these businesses reported that the main reason for not doing so is that homeworking is not suitable for their business, down from 85% in early June 2022.

Further details, including the full list of concerns broken down by industry and size band, are available in our accompanying dataset.

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8. Business performance

Trading businesses were asked how they would describe their business’s overall performance in October 2022, compared with October 2021.

Of trading businesses, 22% reported their overall performance, which includes pricing, trading and workforce, had decreased in October 2022 compared with October 2021.

The other service activities industry saw the largest movement in the proportion of businesses reporting a drop in performance, up to 37% from the 23% reported by businesses comparing September 2022 and September 2021. This was being partially driven by the hairdressing and other beauty treatment sub-industry.

Businesses were also asked how they thought their business would perform in the next 12 months. The proportion of businesses expecting their performance to decrease over the next 12 months was 16%, with 19% expecting their performance to increase. Businesses within the real estate industry reported the largest proportion of businesses expecting their performance to decrease over the next 12 months, at 35%, up 10 percentage points from early October 2022. In contrast, 32% of businesses within the manufacturing industry reported they expect their performance to increase over the same period, up 11 percentage points.

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9. Business Insights and Conditions Survey data

Business insights and impact on the UK economy
Dataset | Released 17 November 2022
Weighted estimates from the voluntary fortnightly Business Insights and Conditions Survey (BICS) about financial performance, workforce, prices, trade and business resilience. This dataset includes additional information collected as part of the survey not presented in this publication.

Business insights and impact on the UK economy confidence intervals
Dataset | Released 22 August 2022
Confidence intervals for weighted estimates from the voluntary fortnightly business survey (BICS) about financial performance, workforce, prices, trade and business resilience. These data are not official statistics but have been developed to deliver timely indicators to help understand the impact of the coronavirus (COVID-19) pandemic and other events.

Access to microdata

You can access the microdata for Waves 1 to 68 of the Business Insights and Conditions Survey (BICS) through the Secure Research Service (SRS). The BICS microdata for each wave are released on a rolling basis in the week following the publication of each wave. The microdata are made confidential and do not disclose information on any specific business. 

Only researchers accredited under the Digital Economy Act are able to access data in the SRS. You can apply for accreditation through the Research Accreditation Service (RAS). You need to have relevant academic or work experience and must successfully attend and complete the assessed Safe Researcher Training. 

To conduct analysis with microdata from the SRS, a project application must be submitted to the Research Accreditation Panel (RAP). To access the SRS, you must also work for an organisation with an Assured Organisational Connectivity agreement in place.

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10. Glossary

Reporting unit

The business unit to which questionnaires are sent is called the reporting unit. The response from the reporting unit can cover the enterprise as a whole or parts of the enterprise identified by lists of local units.

Net balance

Net balance is the difference between the percentage of businesses that reported a decrease, and the percentage of businesses that reported an increase.

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11. Measuring the data

More quality and methodology information (QMI) on strengths, limitations, appropriate uses, and how the data were created is available in our Business Insights and Conditions Survey (BICS) QMI, updated on 24 January 2022. 

The BICS is voluntary, and the results are experimental. More information is available in our Guide to experimental statistics.

The results are based on responses from the voluntary fortnightly BICS, which captures businesses' views on financial performance, workforce, prices, trade and business resilience. The Wave 69 survey was live for the period 31 October to 13 November 2022. The BICS survey questions are available.

Coverage

The Monthly Business Survey (MBS) covers the UK for production and Great Britain (GB) only for services. The Retail Sales Index (RSI) and construction are GB-focused. Therefore, the BICS will be UK-focused for production-based industries but GB-focused for the other elements of the economy covered. The industries covered are: 

  • non-financial services (includes professional, scientific, communication, administrative, transport, accommodation and food, private health and education, and entertainment services) 

  • distribution (includes retail, wholesale, and motor trades) 

  • production (includes manufacturing, oil and gas extraction, energy generation and supply, and water and waste management) 

  • construction (includes civil engineering, housebuilding, property development and specialised construction trades such as plumbers, electricians, and plasterers) 

The following industries are excluded from the survey: 

  • agriculture 

  • public administration and defence 

  • public provision of education and health 

  • finance and insurance 

For more information on the methodology of producing the BICS, such as weighting, please see our BICS quality and methodology information.

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12. Strengths and limitations

More quality and methodology information (QMI) on strengths, limitations, appropriate uses, and how the data were created is available in our Business Insights and Conditions Survey (BICS) QMI.

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14. Cite this statistical bulletin

Office for National Statistics (ONS), released 17 November 2022, ONS website, statistical bulletin, Business insight and impact on the UK economy: 17 November 2022

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Contact details for this Statistical bulletin

Gemma Rabaiotti
bics@ons.gov.uk
Telephone: +44 1633 456417