By Daniel Hunter
One in four small and medium-sized businesses (SMEs) have predicted zero growth in the next six months, according to Virgin Media Business.
The figures suggest that the recovery is not filtering down to smaller businesses, in stark contrast to more positive recent economic statistics.
Mike Smith of Virgin Media Business said that whilst the UK has every right to feel optimistic about the economy, both government and industry need to continue to work together in recognising that smaller businesses, in particular, are still finding the economy challenging.
The study of over 1,000 companies in the UK with two to 250 staff found that a quarter of (24%) SMEs said the current economic situation was their single biggest barrier to growth.
Half of company founders (53%) said getting the right business advice was one of their greatest challenges when setting up their business, just behind understanding taxes and VAT. Fewer than one in 10 (8%) said they turned to government services when they actually had business problems.
However, the research also showed that businesses were failing to appreciate the growth potential in modern digital technology. Only one in five SMEs (20%) said that digital training was a key area for investment in the next five years.
Mike Smith, Director, SMB at Virgin Media Business, said: “Small and medium-sized firms should be the fuel of our economy powered by simple, flexible technology, but we feel that industry and the Government need to look at ways it can provide more support and direct assistance to this group which is UK plc’s driving force.
“Technology has an unrivalled power to help propel businesses forward but people need the skills to be able to use it. With simpler products, better skills and backing from the top, the UK’s businesses will grow faster and that can only be good for the whole economy.
“The UK’s digital economy already accounts for 8% of GDP — more than any other G20 nation — but we risk losing this competitive advantage if we fail to enable our SMBs to use technology better.”
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