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Some of the UK’s leading business groups are urging the Government to take action to help small businesses to create job opportunities, as recent research suggests that firms are looking to shed further positions.

With the latest figures from the Federation of Small Businesses (FSB) showing that small businesses are looking to cut staff in the first three months of this year, the organisation is urging the Government to be ‘bolder’ in its changes to existing employment law.

The survey from the FSB reveals that a net balance of 6.5% of small firms are planning to lay off workers in the first quarter of 2012, representing the highest level since the survey began.

The business group is calling for a number of measures to be implemented in order to help incentivise employment, including exempting the smallest firms from the extension of flexible working rights to all employees.

John Walker, FSB National Chairman, said, ‘The beginning of 2012 is beginning to look bleak with confidence incredibly low and businesses looking to shed staff. However, if the Government makes the right choices and puts action into words we can turn this around’.

The British Chambers of Commerce (BCC) has joined the call, highlighting the fact that unemployment increased by 118,000 in the three months to November 2011, but that employment also increased by 18,000 in the same period.

David Kern, BCC Chief Economist, said, ‘The welcome increase in employment in the last three months was largely due to an increase in people becoming self-employed, while the number of people in full time work fell. This highlights the importance for small businesses and the self-employed to create new jobs. Cutting red tape and making it easier for people to acquire the right skills is vital’.