SMEs optimistic and frustrated as economy set to thrive
With predictions that the UK economy is set to grow at its fastest pace in 80 years and could recover to its pre-pandemic size by the end of this year, SME owners are feeling more optimistic and are keen to invest in growth.
However, they are also frustrated by the mix of financial options open to them, according to a survey from the Association of Chartered Certified Accountants (ACCA) and The Corporate Finance Network (CFN).
Their wish to invest is buoyed by the latest figures from the Office for National Statistics (ONS) which show UK gross domestic product (GDP) for the second quarter is estimated to have increased by 4.8 per cent, which is now 4.4 per cent below the pre-pandemic level at the end of 2019.
There have been increases in services, production and construction output over the quarter, with the largest contributors coming from wholesale and retail trade, accommodation and food service activities and education.
This will be a boost for the large majority of SMEs who are now planning for expansion, with new research from Paragon Bank showing that six in 10 are increasing their innovation budget compared to pre-Covid levels.
More than 75 per cent of business owners list innovation as a key priority to recovery.
But they say they are struggling for financial help in the form of overdrafts and other options like mortgages and leases.
This has not been helped following the winding down of many of the Government-backed support schemes. They are also frustrated at being unable to find the right blend of financing for success.
According to the joint survey this has caused mental health problems with bosses feeling more stressed and anxious.
The difficulties of obtaining finance could not come at a worse time as they are desperate to get back to some normality and go for growth in the future.