The fifth annual ECI Growth Survey, the only survey conducted exclusively among those running high-growth businesses in the UK, finds that business confidence is higher than for several years. Of the 371 decision makers questioned for the survey, the vast majority expected growth to continue in the year ahead but a significant number expect this growth to accelerate compared to the last 12 months.
It is no surprise to find that most feel the coalition’s economic policies have been good for their business
Last years just 11% of respondents expected growth over 26%, this year almost a third (32%) predicted this level of growth. With finance also easier to access that at any point since the survey began (65% predicted it would be easy to access finance, compared with 54% last year), many have plans to expand export operations. Few appear concerned about inflation causing a rise in wage bills. It all points to a positive frame of mind among these business leaders and it is therefore no surprise to find that most feel the coalition’s economic policies have been good for their business. Indeed, this is the first year since the survey started asking the question on the impact of government policies that those viewing them as positive outnumber those who feel ambivalent or neutral about them. This, as much as anything, suggests that policies to promote sustained recovery have finally hit the mark with this section of the business community.
The only potential thorn to pop this good news bubble is the sharp focus renewed growth has placed on structural gaps in the UK labour market. Of all respondents, 82% indicated they are already experiencing some sort of skills shortage. And the picture is not limited to any one part of the UK. Indeed the figures (and the skills required) are fairly consistent across the whole UK. The most in-demand skills remain in perhaps predictable niches such as IT/technology skills and engineering, but other areas such as sales and marketing (itself a possible sign that businesses are again focused on growth and new businesses) and management also rated highly. Here long-term government actions on skills and education, as well as shorter-term actions on immigration, may well have a role to play to ensure these firms can keep growing as they would like to.
In short, the message from this survey is that however fragile the macro-economic picture may be, growth is definitely the watchword on a micro-economic level. The firms quizzed here are raising more finance and intend to spend it to expand, with plans for overseas activity and well as major boosts to R&D and capital expenditure. Growth may be focusing the minds of some as to a potential shortage of skilled staff, which ultimately may be an impediment to longer-term future growth, but in the meantime these businesses are buoyant and looking forward to a more positive, upbeat future.
For more information or to download the full report visit http://www.ecipartners.com/images/uploads/homepage/ECIGrowthSurvey2014.pdf.
Richard Cree is editor-in-chief of economia