The country's small and medium-sized businesses are more optimistic than their overseas counterparts, a new survey suggests.
Research from North East-based accountancy giant Sage found that, despite inflationary pressures impacting trading, UK firms are significantly more optimistic about their prospects than this time last year. Around 12,000 business leaders in countries such as Germany, Poland and South Africa were asked for their sentiments and 40% of UK leaders predicted they will feel 'very confident' about the success of their companies at the end of 2023, compared to 34% globally.
Just more than a fifth of respondents expect falling costs this year, while 46% anticipate higher revenues and almost half expected to increase their staff levels. Around 40% of firms reported cost increases of at least 10% or more while three quarters said they were satisfied with current productivity levels.
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Steve Hare, CEO of Sage Group, said: "SMBs are the backbone of the UK economy and too commonly overlooked. They have emerged resilient from a difficult 2022 and have ambitious goals of scaling their businesses. The Government and the private sector must now work together to make this possible.
"The Government has rightly set out an ambitious vision for the digitalisation of the UK economy. We see strong appetite amongst SMBs for an acceleration of investment and adoption of new tech solutions, but the UK lags behind in the level of tech investment they anticipate committing.
"To support SMBs and drive economic growth in the UK, the Government needs to take a bolder approach towards tax, to incentivise digital investment. This is essential for millions of SMBs to have the resources they need to compete on a global scale, and to make the UK an advanced digital economy.”
Sage's research also pointed to large proportion of firms planning to maintain or increase investment in tech. The survey found UK businesses were more likely to adopt emerging tech - including 5G, AI and the metaverse - than any other country, though increases in investment levels were below that of European counterparts.
Elsewhere, access to talent was shown to be of critical concern, with more than a third of UK small and medium-sized business (39%) unsatisfied with their ability to recruit talent.
Autumn Rabbitts, owner and founder of Alnwick-based Plumb and Rabbits Cake Studio and Sweet Solstice Café, said: "This year has been a big leap of faith for me. Despite the headwinds, and increased costs of ingredients, which has been huge for a baker and café owner, I decided to move forward rather than stay still.
"For my business, this meant moving premises to a new and larger site, doubling the staff I employ, with further plans to open a cake decorating school. It is daunting but I have never been as optimistic about my business and I am marching forward full steam ahead into the next 12 months."
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