By Daniel Hunter

Small businesses are taking on more staff compared with last quarter according to the Federation of Small Businesses.

The Voice of Small Business Index found that 15 per cent have increased their staff numbers in the third quarter of 2013. This is the highest figure reported since the Index began in 2010 and mirrors recent improvement in labour market figures.

Furthermore, all small businesses will be eligible for a cut of up to £2,000 in their National Insurance Contributions from April 2014 which should provide further encouragement to this trend. According to FSB research, small businesses will use the ‘Employment Allowance’ to boost staff wages (29%), employ additional staff (28%) and invest in resources (24%).

Small firms can create more jobs for the UK economy, but they need greater support from government policymakers. This is more important than ever considering that nearly 900,000 people have been unemployed for more than one year while 960,000 young people remain out of work. The FSB knows that the vast majority (88%) of unemployed people who enter the workforce do so by starting a business or working for an SME.

This will be the starting point for discussing ways in which the Coalition Government can encourage further job creation from small firms. The FSB will be debating this subject at the Liberal Democratic Conference during an event hosted with IPPR, the Institute for Public Policy Research.

“Compared with a year ago, small businesses are employing more staff and are looking to expand in the near future. This points to growing confidence from the UK’s small businesses," John Allan, National Chairman, Federation of Small Businesses, said.

”Our findings show that the Employment Allowance due to kick in next spring will have the desired effect. Through the measure, small firms are looking forward to taking on more staff, expanding their businesses and rewarding existing employees for their efforts.

“That said, the most recent unemployment figures show that long term unemployment, particularly among young people remains a concern. That’s why we will be discussing what further action the Coalition Government can take to support the UK’s small firms in creating jobs at the Liberal Democrat Conference.”

Join us on
Follow @freshbusiness