BUSINESS confidence has been hit by the spending cuts announced in June’s emergency Budget, according to a Bank of England survey.
It reports that confidence amongst bosses has plunged with rising nervousness about the impact of the cuts.
“Many businesses linked the decline in confidence to the planned cuts in public spending, which were expected to lead to weaker demand, both directly in those sectors with significant public sector exposure, and indirectly by reducing public sector employment and hence household income,” the Bank reported.
On jobs, the survey found:
“In recent months, private sector contacts had reported only a modest rise in recruitment intentions, with uncertainty about the economic recovery prompting many contacts to meet increases in demand using their existing resources, or by hiring temporary staff. Moreover, the modest rise in private sector intentions had been outweighed by expected cuts in the public sector. A few contacts also noted that cuts in public spending might lead to further falls in private sector employment, by reducing demand for private sector services.”
Companies were waiting to see how details of cuts unfolded in the October spending review.
Shoppers also appeared to be holding back from buying goods. Retail sales growth has slowed as businesses fear that consumer spending will suffer as public sector jobs are cut and incomes squeezed.
The property sector has also been suffering, after the Government cancelled the Building Schools for the Future project. Builders reported that their workloads fell in the three months to July, according to a survey by the Royal Institution of Chartered Surveyors.
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'Proud to serve the public’ is a North West TUC campaign to protect and promote public services in our Region. We believe public services are a vital part of the North West economy. They create jobs, stimulate growth and... 
So the public sector cuts are having an impact on private enterprise too? Shouldnt this have been a bit obvious to our Government?