Business leaders across the UK are cautious about their scope to grow within the economic outlook according to research carried out by the Close Brothers Business Barometer.
Research also raised that SMEs within the UK have taken a dip when it comes to their confidence compared to the start of 2016. Just one in five SMEs who responded to the Barometer revealed that they are confident in regards to the stable economy recovery. Whilst 31% claimed that the yellow brick road to prosperity will take a while to walk however, they do believe that the issues linked to the economy are now in the past.
With that in mind, why have over a quarter of respondents said that they do not believe that the economy is changing at all? Those who claimed that the economy was getting worse during the start of the year have not changed their opinion.
The cynicism that SMEs have has proven that there are many issues that need to be raised. Decision makers are also concerned because of the macro-economic outlook as they face the EU Referendum this month. Amongst this, is the increase in national minimum wage, the new tax regulation and the pension auto-enrolment!
Only one-fifth believe that their company will grow and expand during the next 12 months and a shocking 57% trust that their business will not grow at all and one in ten think their business will either shut down or contract.
CEO of Close Brothers Invoice Finance, David Thomas comments;
“We know that many entrepreneurs and business leaders have exciting and ambitious plans for their companies, but fear their plans are not achievable against a backdrop of economic uncertainty and rising costs; in many case, SMEs now feel even more pessimistic than they did at the beginning of the year.”
Figures show that SMEs cannot bare another year of disappointment as they believe they did not achieve anything the previous year. In fact, 52% claim that their business did not grow over the past 12 months.
“After the financial crisis of 2008, we saw similar low levels of confidence in SMEs. We found it was the businesses that explored every possible funding option and ensured their enterprises were constructed on firm financial foundations that were able to ride out the uncertainty and continue working towards their growth ambitions.”