Small and medium-sized enterprises (SMEs) in the UK are confident and optimistic about their future prospects according to a new survey.
The research found that 49% of British SME decision-makers do not have any business concerns which cause them to overly worry. Those who do say they have concerns identify finding skilled staff as the most common anxiety.
The report, produced in conjunction with YouGov and the Centre for Economics and Business Research (CEBR), found that 33% of SMEs plan to take on more staff within the next year. However, 36% of medium sized businesses and 14% of smaller companies said that finding the right staff is causing them sleepless nights. Late payments, rising costs and competition with other businesses were also key concerns for business decision makers.
While costs for SMEs rose on a year-on-year basis, cost inflation for UK SMEs fell slightly from 0.9% in Q4 2014 to 0.7% in Q1 2015. Purchases of physical inputs and labour accounted for the majority of this increase in cost, yet SMEs remain focused on growth with 37% planning to launch new products and services in the coming 12 months.
Carl D’Ammassa, group managing director for business finance at Aldermore, said: “We entered 2015 on a weak note with GDP expanding by just 0.3%, compared to 0.6% in Q4 2014; SMEs in the UK have not had an easy ride but they are clearly in robust shape and confident about their futures.
“The labour market has tightened significantly over the past year, with unemployment having fallen to 5.5%, the lowest since 2008 so it is no surprise that finding new staff has become more of a challenge for SMEs. However, needing more staff can be a great problem to have and it’s certainly good news for the UK economy.”
“UK unemployment is falling back to near pre financial crisis levels, bringing with it the challenge of skills shortages,” added CEBR’s managing economist Rob Harbron.
“However despite these, it’s encouraging to see a large share of the SME population hoping to take on more staff. With low cost inflation supporting bottom lines, 2015 as a whole is looking to be a positive year for the private sector.”