The data, compiled by iwoca, one of Europe’s largest SME lenders, finds that 44% of companies plan to host a Christmas party for staff this year, down from 63% who said they did in previous years.

Business owners who aren’t hosting a get-together for staff say it could be down to either a lack of Christmas cheer or rising costs. Nearly a third (30%) of company leaders say they never have social occasions at work, while a quarter (23%) claim staff just don’t want a Christmas party.

When it comes to costs, a fifth (21%) of small businesses say the cost of parties is too high, and a further 10% say celebrations are off because their company won’t make enough money this year.

Of the 5.6m small and medium-sized businesses which are putting on a Christmas do, the most popular option is a dinner, favoured by just under half (46%) of company bosses.

Mark Di-Toro, Director at iwoca, said: “This data is another sign that rising costs across the board are hitting Britain’s business owners hard. Christmas parties can often be the first thing to go, but what impact could that have on staff morale and retention? Employees may shrug off a missed Christmas party, but if this is just the start of a cutback in company culture, it could lead to bigger problems.”