At a glance
- Confidence and growth return, as the SME recovery continues
- Government committed to supporting the promising Tech sector, with Financial Services results also bullish
- Overall picture of ‘cautious optimism’ going into winter
Written by the Economist Intelligence Unit exclusively for Zurich’s brokers
Back in August, Zurich Insider hinted that the SME sector was primed for growth. Now Britain’s small businesses have reason to be cautiously optimistic, in two sectors particularly.
- As SME growth sectors, Technology and Financial Services sectors hold new business opportunities for SME brokers
- Participation in Tech and Financial Services industry events, awards or exhibitions will help to build links that could boost the chances of landing this desirable new business — anything from the Finance for the Future Awards to the Travel Technology Exhibition, or something more regional
Economic growth has been steadily rising, unemployment slowly retreating and for the first time since 2008 the number of new business ‘births’ has overtaken the number of businesses closing. Small and medium-sized enterprises (SMEs) are looking to a brighter future, intending to hire more staff and invest in the business.
Financial services and technology have surged ahead, while consumer-reliant sectors, such as retail, restaurants and entertainment, have not fared as well.
According to the Federation of Small Businesses (FSB), financial services lead business confidence, while tech-based SMEs were the next most positive. Technology-related SMEs are also the new darlings of Downing Street. This summer, the government published its Information Economy Strategy, setting out the vision for Britain to become a leading information economy through investment and prioritisation of digital skills and infrastructure.
East London’s ‘Silicon Roundabout’ has benefited from government support from the Tech City Investment Organisation, which has fostered 1,300 start-ups, while Cambridgeshire’s research and development hub ‘Silicon Fen’ has 150,000 (mostly small) businesses with a combined revenue of £12bn.
Mike Cherry, FSB national policy chairman, says the outlook is one of “cautious optimism” but highlights that risks remain: “I’m always a little bit cautious over the winter months, when you look at energy costs coming through [and] we’ve got the index for business rates coming out at the end of this month…so, there are certainly some issues that need to be addressed going forwards.”