Over a third of UK firms to hike prices amid surging energy costs

·Finance Reporter, Yahoo Finance UK
·2-min read
UK firms A staff member works at PALLITE, a designer and manufacturer of social distancing screens and desks from recyclable paper board, amid the outbreak of the coronavirus disease (COVID-19), in Wellingborough, Britain, July 20, 2020. REUTERS/Andrew Boyers
UK firms warn that prices will go up in September. Photo: Andrew Boyers/Reuters

Over a third of UK firms plan to hike their prices next month, according to the Office for National Statistics (ONS).

Across firms with more than 10 employees, 35% told the ONS they expect prices to increase. Overall, of trading businesses, 29% expect the prices of the goods or services they sell to increase in September, up from 26% reporting expected price increases reported for August.

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Energy prices continue to reported as the most common reason for hiking in prices.

Over 40% of firms said the prices they paid for goods and services had risen in July, compared with June.

The figures also show that six percent of UK businesses reported that they had been affected by industrial action in July 2022.

The human health and social work activities industry reported the highest percentage of businesses affected by industrial action in July 2022, at 10%.

Of businesses who had been affected by industrial action in July, more than a quarter (28%) reported their workforce were unable to perform their roles, while 20% reported their workforce had to change their working location as a result.

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The ONS said that in early August 2022, more than 1 in 10 (11%) businesses reported a moderate or severe risk of insolvency.

The official statistics body also published data on consumer spending, showing that UK households cut back last week.

Consumer behaviour indicators mostly revealed reduced activity in the latest week, with UK credit and debit card purchases falling 4 percentage points.

Spending fell across the board, driven by large falls in “delayable” and “social” spending. They fell by 8 and 4 percentage points, respectively, suggesting people cut back on non-essential purchases as the cost of living rose.

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