The UK’s ‘haters’ may believe our growth prospects are limited (the OECD, for example, reckons the economy will expand by a mere 1.7% this year). But if a new survey is anything to go by, businesses are champing at the bit to grow, and what’s more, they’re prepared to splash out to make sure it happens – to the tune of almost £75bn. According to a survey of 1,000 European SMEs by finance provider GE Capital, almost 92% of the 250 British firms polled were planning to invest in their business – and they’re intending to plough in an average of £73,805 worth of capital expenditure to help them grow. Have some of that, doubters.
The report claims firms have missed out on a staggering £8bn worth of business over the last few years, because their reluctance to spend meant they weren’t properly equipped to take on new jobs. But now, 96% of small- and medium-sized businesses (i.e. those with 10-249 employees) and 81% of micro-businesses (2-9 employees) are planning to splurge on everything from commercial vehicles to company cars, and new IT and office equipment (nothing says ‘growth’ like a snazzy new wheelie chair), while 81% of manufacturing companies are apparently planning to buy new plant or equipment.
Perhaps the most encouraging news was that 18% of firms said they were investing in order to fulfil new orders or new business opportunities - so these firms, at least, are obviously seeing plenty of demand. Of the rest, 24% said they’re making new purchases because their existing stuff is getting on a bit, and just over a third said it’s to ‘enhance efficiency and productivity’. So, super-futuristic productivity robots all round, then.
And judging by the latest trade figures, we’re going to need that (the extra capacity, we mean - not the robots). According to the Office for National Statistics, the trade deficit widened to £4.1bn in May, from £3.1bn the month before. Apparently, that’s because of a 13% surge in imports of semi-manufactured goods and a 20% rise in chemical products. Although we did manage to export a bit more: the volume of exports grew by almost 2%. So if we’re going to get that deficit down and get the rebalancing of the economy on track, we’re going to need our smaller manufacturers to be firing on all cylinders…