Cumbria businesses are reporting that increased costs are the major challenge impacting their growth prospects.

This concern was expressed by 50 per cent of the businesses, as per the latest Family, Privately Owned and Owner-managed Business Survey executed by Armstrong Watson.

The survey received 172 responses from businesses based in Cumbria.

The report also showed that roughly 32 per cent of the business owners are worried about marketplace competition.

Meanwhile, concerns about staff recruitment and cash flow came in a close third, troubling around 30% per cent of the business owners.

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National concerns were similarly reflected in the survey.

About 49 per cent of businesses admitted to being worried about the increase in the National Minimum Wage (NMW) and National Living Wage (NLW).

39 per cent of respondents suggested the new hourly rates, which increased by almost 10 per cent and over 21 per cent for under 18's and apprentices for the NLW and NMW respectively, were bound to affect their business.

Alongside that, 11 per cent of owners went as far as stating the repercussions would be 'significant'.

The survey ran from November to December 2023, collecting views of 300 business owners.

It probed into various topics, including recruitment challenges, how they are adapting towards the digital world, and the plan for innovation and growth.

Plus, it sought their opinions on external pressures and matters likely to impact business growth within the next three years.

Recruitment was recognised as a major challenge by one-third of all businesses surveyed.

The figures, which are an 8 per cent increase from 2018, came despite 65 per cent of businesses having made changes to help with recruitment.

In Cumbria, the scenario looks even bleaker, with 74 per cent of businesses claiming recruitment is difficult due to a shortage of suitable and skilled candidates.

Armstrong Watson’s chief executive and managing partner, Paul Dickson said: "Our latest survey has revealed some critical insights into the current landscape of family owned, privately owned, and owner-managed businesses and how challenges over the past five years - the Covid-19 pandemic, labour shortages, supply chain disruptions, inflation and the cost-of-living crisis – have affected these businesses."

News and Star: Paul Dickson has shared his thoughts on the findings

Mr Dickson also addressed the recent increase in the NMW and NLW saying: "The widespread impact of the increase to the National Minimum Wage and National Living Wage – which will see payroll costs increase across the board – is one key challenge faced in balancing fair wages with sustainable growth.

"The ongoing struggle with talent acquisition, despite many making changes to aid recruitment, indicates a growing challenge in the labour market but it is positive to see that the data shows businesses are taking proactive steps to retain staff."

Mr Dickson ended on a positive note as he said: "These findings highlight the resilience, adaptability, and innovative spirit of family owned, privately owned, and owner-managed businesses and also areas in which they might need support.

"Despite facing numerous challenges, they continue to evolve and adapt, demonstrating their crucial role in our economy."

Those wishing to view the full report can visit: www.armstrongwatson.info/survey24.