More than two-thirds of employers will have no jobs to offer this summer as this year’s school leavers and new graduates try to find a place in the world of work.
A survey by the British Chambers of Commerce covering 430 businesses across the UK found that 69 per cent of them will not attempt to recruit in the next three months.
More than half said that their debtors are taking longer to pay than they were three months ago.
While 11.4 per cent said Chancellor Alistair Darling’s temporary VAT cut had benefited their businesses, they were outnumbered by 12.1 per cent who found it a burden.
“These results show just how tough cash flow conditions are, with half of businesses hamstrung by increasingly late payments,” said David Frost, the British Chambers’ director general.
“The knock-on effect is that under a third of employers are planning to recruit over the next three months.
“More needs to be done to improve company cash flow and prevent the steady rise in unemployment. It is clear that the help on offer in the Budget fell short of expectations.
“Announcing a moratorium on new employment law and scrapping the planned rise in National Insurance would send a signal that the Government is serious about supporting jobs.”
Asked to rate the Budget in marks out of ten, with ten points indicating the greatest approval and one the least, more than a third of the respondents awarded it the minimum single point. The average rating was 2.6. The survey indicated that most of the respondents – more than three-quarters of them small firms employing fewer than 50 people – are slightly less gloomy about their immediate prospects than they were in January.
Nearly 30 per cent said they expect their turnover to increase by up to 25 per cent over the next three months, up from 22 per cent in January.
In the opposite direction, 25 per cent expect falls of a similar size, down from 31 per cent.