Among private businesses in the UK, optimism is rapidly diminishing, according to new research from PwC. It is falling at more than twice the rate of European counterparts.
PwC polled 2,400 organisations in 31 countries for its European Private Business Survey. Among the 220 UK firms, growth expectations fell to less than half, having been at 69% last year.
Although growth expectations among the other countries also fell, it was by only 8%, from 65% in 2018 to 57% now.
The survey also revealed that across Europe, businesses are facing a widening skills gap. In the UK, PwC estimates, the lack of appropriate skill costs an annual £29bn in lost revenue.
Brexit also remains a concern for businesses. Suzi Woolfson, PwC’s UK private business leader, pointed out that “until there is some certainty around it, businesses will continue to tread carefully.”
Woolfson also highlighted the possibilities that come from uncertainty, “those companies that are agile and flexible can benefit enormously”, she said.
Commenting on the skills shortage that the survey threw light on, she said, “Across Europe we are seeing a skills shortage becoming a significant issue for private businesses and in the UK, while companies say the problem is improving in comparison to last year, overall the impact is still significant”.
UK private businesses are more open than those in Europe to funding from private equity or venture capital for digitalisation, the survey found.
Woolfson said, “Our survey shows that UK private businesses recognise the importance of technology to their long term aspirations, which is why it is important to invest in technology and data to ensure real commercial improvements in systems and processes.
“With their ability to be nimble and decisive, private companies are well-placed to make strategic investments which can lead to substantial benefits”, she added.
By Frances Ball