UK businesses are divided over the Brexit outlook with large businesses significantly more optimistic about the future than their small business counterparts, according to a new study.
The joint research project by NGA Human Resources (NGA HR) and its SME division, Moorepay, reveals that six in ten (59 per cent) respondents working for large businesses expect Brexit to have a positive impact on their business, but only 35 per cent of SMEs share this view.
In fact, a quarter of (25 per cent) SME employees in the UK actually believe their situation will worsen after the UK has left the European Union.
Looking ahead, the majority (79 per cent) of larger UK businesses are ready to address the challenges and exploit the opportunities resulting from Brexit, whereas just over half of small businesses (56 per cent) feel the same.
Pessimistic Brexit outlook
Alison Dodd, managing director at Moorepay, thinks that SMEs form the backbone of the UK economy and it should be cause for concern that the small business community is increasingly pessimistic about the consequences of Brexit.
She says, ‘Most of them don’t like the uncertainty that comes with such substantial changes to the economy and the labour market. However, it is important for them to remember that not everything is doom and gloom.
‘By making preparations now and looking at how the Brexit will potentially impact their organisation, SMEs can make sure they make it through the stormy months and years ahead without putting their business at risk.’
The study says that all UK businesses agree that access to the single market is the biggest advantage of the EU membership and one that both large businesses (64 per cent) and SMEs (54 per cent) would like to retain.
Additionally, opening up trade to new countries and markets is seen as the main advantage of Brexit for both large (70 per cent) and smaller businesses (54 per cent), followed by freedom from EU laws and regulations (both 48 per cent).
Mark Sismey-Durrant, chief executive officer at Hampshire Trust Bank believes the cautious approach is understandable, but SMEs need to invest in their businesses for the long term.
He says, ‘Today’s GDP figures are positive news for UK SMEs and we urge smaller businesses, the engine room of the UK economy, to remain positive about the longer term.
‘Our recent SME Savings Tracker research reveals that businesses are building up cash reserves, with 30 per cent saying they intend to increase the amount of money in business savings following the outcome of the EU referendum.’