While short-term pessimism remains among small businesses, it seems that SMEs predict steady growth in the longer haul, according to a survey.
British companies predict an increase in real GDP and an improved business landscape over the next decade, according to the ‘Business in 2021’ research of 664 business leaders by Barclays Corporate.
The study, in which respondents were surveyed on the conditions they expect their businesses to face in a decade, finds respondents generally positive about the UK’s long term economic prospects, with half expecting the UK to be a better place to do business in 2021. Just 29 per cent expect UK business conditions to deteriorate and a further 13 per cent expect conditions to be similar to today.
It’s an encouraging attitude to take in the face of the spate of catastrophes hitting the economy of late, from the shockwaves of sovereign debt crises hitting stock markets to predictions of dismal growth and fears of a double-dip recession.
Views vary interestingly between regions. More than two-thirds of respondents in Northern Ireland, Scotland and the East Midlands are all positive about the future, compared with just 44 per cent of London companies. Given that businesses in the North of the UK are reportedly twice as likely to be in debt as those in the South, this is a surprising find.
Certain sectors are also far less confident about the future, with retailers the least positive over the long term, with 55 per cent predicting the UK will be a worse place to do business in ten years. Conversely, 63 per cent of tech sector businesses see the UK as offering a better place to do business in 2021. Maybe they have been won over by Cameron’s ‘Silicon Roundabout’ rhetoric.
More than half of businesses (55 per cent) predict steady and sustained growth over the coming decade, although a significant minority (31 per cent) expect zero or negative growth over the next ten years. When asked what will fuel this growth, technology is cited by 88 per cent of businesses as being a key driver. That roundabout really does have expectations to fulfil.
Kevin Wall, managing director of Barclays Corporate, believes that businesses have faith in the strength of the UK as a place to do business, and that any ‘challenges’ being faced are only temporary. Let’s hope he’s right.
