Franchise View: Unemployment hits 17 year high
Carl Reader, Dennis & Turnbull Ltd
Unemployment hit a 17 year high in the three months to August, the latest statistics have shown.
The Office for National Statistics (ONS) released the figures, which show the unemployment rate was at 8.1 per cent, making a total of 2.57 million unemployed people.
The quarterly increase of 114,000 people has been described as ‘horrific’ by Dr John Philpott, chief economic adviser at the Chartered Institute of Personell and Development (CIPD). He said:
“These labour market figures are truly horrific, with the economy shedding almost 15,000 jobs each week between June and August. The quarterly rise in unemployment is reminiscent of an economy in recession rather than any kind of recovery and confirms that the private sector just isn’t creating enough jobs at present to offset public sector job cuts.
“With 5.6 unemployed people for every job vacancy the labour market is back to where it was in the depths of recession in 2009 and the underlying problem is getting even worse given that 1 in 3 unemployed people have now been without work for over a year.”
The number of 16 to 24 year olds out of work is now at its highest level since 1992, demonstrating how important it is for the Government to do more to support businesses to grow and employ more staff.
Commenting, Katja Hall, CBI Chief Policy Director, said:
“Today’s unemployment numbers make grim reading, especially for our young people. The continuing rise in youth unemployment is a grave concern for us all.
“Businesses are still creating jobs and only continuing private sector growth can help us out of the current tumult. With jobs falling in the public sector, it’s vital the Government does everything it can to support businesses to grow and create jobs, and help young people get into work.”
With such a stark outlook, starting a franchise business could be a way out for many stuck in the unemployment trap. A franchise is basically a way to start up your own business using a proven business model with the support and backing of the franchisor.
Carl Reader is the head of franchising at franchise accountants Dennis & Turnbull, a leading firm of accountants in the franchise industry.
The above information is provided as general advice and no liability is accepted by the author, Dennis & Turnbull or Select Your Franchise in respect of individuals or businesses acting on the above. Independent advice should be sought in all circumstances.
Franchise Finance Focus: Banks set to meet lending targets
Carl Reader, Dennis & Turnbull Ltd
If you are considering buying a franchise, then obtaining funding in orde to start up your new franchise business will be high on your agenda. Over the past number of years there has been much talk about obtaining finance from banks becoming more difficult due to more stringent criteria in order to meet borrowing requirements.
The good news is that the UK’s major banks look likely to meet their small business lending targets as agreed with the Government.
According to the British Bankers’ Association (BBA), the main five high street banks (Barclays, HSBC, Lloyds, RBS and Santander) loaned £37.4 billion to SMEs in the first six months of the year.
Under the terms of Project Merlin, to which the banks signed up as part of Government plans to boost the levels of credit and finance available to smaller firms, the target for the whole of 2011 is £76 billion.
A spokesperson for the Merlin banks said: “The first half year performance demonstrates the banks’ commitment to providing businesses with the financial support they need to invest and grow and the significant progress made this year.
“The banks’ efforts to encourage customers to come forward with borrowing proposals are set against the overall economic environment which remains challenging and business demand for credit which remains weak.”
Carl Reader is the head of franchising at franchise accountants Dennis & Turnbull, a leading firm of accountants in the franchise industry.
The above information is provided as general advice and no liability is accepted by the author, Dennis & Turnbull or Select Your Franchise in respect of individuals or businesses acting on the above. Independent advice should be sought in all circumstances.
The Budget 2011 and the affects on your Franchise Business
Carl Reader, Dennis & Turnbull Ltd
A summary of some points that may affect your business as a franchise, from the 2011 Budget announced yesterday:-
- It was confirmed that the Income Tax rates previously announced will come into effect from 6th April 2011. The personal allowance will increase to £7,475 for 2011/12 with a further increase to £8,105 for 2012/13. There will be a review carried out in respect of Income Tax and National Insurance Contributions to look to integrate them in the future.
- Capital Gains Tax rates have remained the same. The annual exemption will increase to £10,600 from 6th April 2011. However, the lifetime limit for Entrepreneurs’ Relief has doubled to £10 million for disposals made from 6th April 2011. The Inheritance Tax nil rate band will remain at £325,000 until 2014/15.
- The rate of corporation tax for 2011/12 for small companies will reduce to 20% as previously announced. For large companies it is now reduced to 26% and will further reduce by 1% each year until it reaches 23%.
- The VAT registration threshold has increased to £73,000 with the deregistration limit increased to £70,000. The fuel scale charges have also been increased for periods starting from 1st May 2011.
- The authorised mileage rate has finally increased to 45p per mile for the first 10,000 business miles per annum from 6th April 2011. Any mileage over this will continue to be at 25p per mile.
- With regard to business rates the government will continue to fund a temporary increase in the level of rate relief so that small firms occupying properties with a rateable value up to £6,000 will pay no business rates for another year to October 2012.
A more comprehensive analysis of the 2011 budget can be downloaded at the following link:-
http://www.dennisandturnbull.com/budget-2011
Carl Reader is the head of franchising at franchise accountants Dennis & Turnbull, a leading firm of accountants in the franchise industry.
The above information is provided as general advice and no liability is accepted by the author, Dennis & Turnbull or Select Your Franchise in respect of individuals or businesses acting on the above. Independent advice should be sought in all circumstances.
Tags: budget, budget 2011, carl reader, Franchise Finance
