November 2016 economic statistics: All the figures SMEs need to know

Who said the November 2016 economic statistics roundup would only bear bad news? Instead, we start it off with a little cheer. WBS has suggested GDP growth would likely be between two and three per cent in 2017. This is in contrast to the pessimistic forecasts made by the Office for Budget Responsibility (OBR) and Bank of England – the former said “any likely Brexit outcome would lead to lower trade flows and lower investment than the UK would otherwise have seen.”

There is a 75 per cent chance that growth in 2017 will exceed the OBR’s expectations, WBS claimed – this could change from 2018 onwards though. Ana Galvao of the Economic Modelling and Forecasting Group at WBS, said: “The WBS forecasts are produced under the assumption that historical relationships and patterns in macro-economic data continue to hold post-Brexit. They may well break down. But while a change for the worse in terms of future economic growth may happen, there is no indication that this will happen in 2017.”

It makes sense then, that 74 per cent of UK firms are brushing off the Brexit vote. The shock of the referendum result was much briefer than expected, and as such many companies adopted a business as usual approach. After all, Britain is still technically part of the EU, which may be one of the reasons WBS believes 2017 will not yet feel the aftermath.

When we find out what Brexit actually means, there’s no doubt things will begin to change. For the November 2016 economic statistics piece, Andrew Tate, president of R3, told Real Business: “In the short-term at least, there are likely to be one or two instances of Brexit being used as a convenient excuse by companies which run into trouble.

“That being said, Brexit will cause genuine problems for a significant minority of companies. The main reason for this is the sharp fall in the value of the pound. And uncertainty over the future of the UK-EU relationship may put some important deals on hold, at least temporarily. Some of our members have reported an increase in calls from worried business owners looking for advice. While a number of recent surveys have reported business confidence falling since the vote, that doesn’t appear to have yet translated into a financial impact for most.”

This doesn’t mean it’s smooth sailing for the UK though, as our November 2016 economic statistics brought to light the fact that SMEs are poorly cushioned against the “shocks” of uncertain times.

Essentially, 4.2m of the nation’s 5.5m businesses have no employees and run entirely on the efforts of one person. This was according to AXA, which said incidents such as illness could spell closure and a rapid fall in income. The firm’s survey highlighted that few feel confident enough to put money aside for hard times. The average business could only keep going for three months on current funds, and one in ten claimed resources would not stretch to the next month.

When the consequences of Brexit truly hit the UK, the firms most prepared will keep floating above water.

Read on to find out how the dread skills gap is looming its ugly head once more.

Image: Shutterstock

By Shané Schutte

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