Quarter of firms see turnover slump amid cost-of-living crunch

Almost a quarter of UK firms have revealed a slump in trade over the past month as cost-of-living pressures continue to bite, according to new figures.

The Office for National Statistics (ONS), in its latest fortnightly business survey, found 24% of companies said their turnover dropped in June compared with May.

Meanwhile, 17% of companies said they think their turnover will decline further due to the economic backdrop.

It comes as half of firms reported that they bought more expensive goods and services over the month.

UK inflation increased to 9.1% in May amid surging energy prices and is expected to have risen further in June when the latest readings are confirmed later this month.

The number saying of companies saying their costs were increasing was “broadly stable” against May’s data.

However, there were signs of improvement in June as 20% of companies reported an increase in the price of goods and services they sold, dipping from 24% in the previous month.

There was also a decrease in the number of firms planning to pass further price increases on to customers.

Around 26% of surveyed businesses said they expect to hike prices in August, down from 31% in April.

Nevertheless, energy costs are still a particular concern for UK industry, with 37% of companies raising prices saying energy is the predominant reason for doing so.