Business News Round Up (04/05/2023)

SME trends turn positive as orders pick up

Business confidence among SME manufacturers stabilised in the quarter to April, according to the CBI’s latest SME Trends survey, ending a run of five consecutive quarters of declining sentiment. SME manufacturers expect both output and new orders to pick up in the three months to July as some of the challenges that faced the UK’s SME manufacturing sector in 2022 continued to ease. The share of firms reporting that shortages of skilled labour and shortages of materials or components could constrain output over the next three months fell back further from last year’s highs (while remaining above average). The share citing concerns over orders or sales rose to its highest level since July 2021 (but remained below average). The survey suggests that both cost and price growth eased over the quarter, slowing from 2022’s record rates, though remaining historically strong. SMEs expect growth in average unit costs to slow further in the next three months, but to continue to outpace growth in domestic selling prices, which are expected to increase at a similar rate to last quarter. Investment intentions were mixed, with SME manufacturers expecting to reduce spending in buildings in the year ahead and to keep spending on plant and machinery flat. Spending on innovation, and on training and retraining is expected to rise. 

https://dailybusinessgroup.co.uk/2023/05/sme-trends-turn-positive-as-orders-pick-up/

North West mid-sized firms growing faster than FTSE

Despite economic challenges, the North West’s mid-market has grown revenues and profits in the last year, according to new research from accountancy and business advisory firm, BDO. Mid-sized businesses in the North West reported 11% growth in revenues in the last year. Total revenues generated by these businesses reached £136bn and they have created more than 773,000 jobs. In comparison, London’s mid-sized businesses recorded the most significant turnover growth of 17%, outperforming all other UK regions. Businesses with revenues between £10m and £300m, AIM listed, and private equity owned, what BDO calls the economic engine, grew overall turnover by 12% in the last year, to £1.5tn. This compares to overall turnover growth of 10% for FTSE 350 businesses and a reduction of more than a third (36%) in turnover for smaller businesses, defined as those with less than £10m in revenues. Mid-sized businesses also demonstrated resilience in employment levels, reporting a national increase in jobs of 1% in the last year. This brings the total number of employees to eight million, accounting for one in four UK jobs. However, North West businesses saw a 1.5% drop in job creation in the past year despite an overall 27% growth in job figures over a five-year period.

Flexible working to boost UK productivity by 12% over next decade

DocuSign, Inc. which offers the world’s #1 e-signature solution, today released findings from a new report, “Unlocking the potential of the anywhere economy,” that examines the opportunities and challenges the anywhere economy brings to people, businesses, and countries.The findings of the report reveal we have entered an era that is poised for considerable business growth and the potential to experience new levels of productivity. The research, undertaken by think tank Economist Impact, reveals insights from two global surveys across ten countries to gauge the sentiments and experiences among consumers and executives in the U.S., Australia, Japan, France, Germany, Ireland, the UK, Brazil, Mexico, and Canada, as well as new econometric models that forecast the potential impacts of the anywhere economy in these countries. The report reveals that both executives (59%) and consumers (47%) expect the anywhere economy will continue to accelerate, with an overall positive impact on job creation, a broadened range of online services, and improved equity and well-being.

Scottish construction professionals expect growth for the first time in almost a year

Activity in the Scottish construction sector continued to fall at the start of this year, as a challenging economic environment continued to impact the industry. The latest Royal Institution of Chartered Surveyors (RICS) Construction Monitor also revealed that surveyors’ now expect growth in the 12 months ahead for the first time in almost a year. A net balance of -6% of Scottish respondents said that workloads fell; the second consecutive quarter that this indicator was in negative territory. This is compared to the net balance +3% of respondents at the UK level. But on a 12-month horizon, Scottish surveyors now expect growth, with a +12% saying that workloads will be higher in a year’s time. Looking at the current workloads, private housing experienced the steepest slowdown of the sub-sectors, with a net balance of -21% of respondents reported. Most other sub-sectors were said to have had broadly flat workloads, other than infrastructure. A net balance of +14% of respondents said that infrastructure workloads increased in the quarter. With the expected rise in workloads, respondents in Scotland also expect employment to increase, with a net balance of +26% expecting employment levels to be higher in a year’s time. In line with this relatively robust employment picture, skills shortages don’t appear to have eased, with shortages of quantity surveyors bricklayers and other construction professionals continuing to be reported.

https://www.insider.co.uk/news/scottish-construction-professionals-expect-growth-29878630