Is it interesting times for the UK economy?
“May you live in interesting times” goes the Chinese expression. In fact, it’s actually more of a subtle barb to denote disorder and uncertainty. And right now, it would appear that we live in just such a period of history. In the US, we have an “unorthodox” presidency that has a more isolationist outlook, Brexit negotiations seem to be at an impasse, and the push for Catalonian independence threatens a political crisis in Spain. And that’s not to mention the continuing conflict in the Middle East and tension in North Korea. All of these issues have repercussions for the global economy. But what might they mean for SMEs? How can they thrive in the midst of all this uncertainty?
Firstly, we need to outline some of the core difficulties facing businesses. In the interest of simplicity, I am drawing on facts and figures from the UK economy but many of the general difficulties – and certainly the sense of uncertainty – apply throughout the world. There’s the problem of wage stagnation, with a report in The Guardian citing the think tank The Resolution Foundation, which stated that “the 2010s are on course to be the worst decade for wage growth since the one that included the Battle of Trafalgar in 1805.” Also, much has been made of a skills deficit. According to Lloyds Bank’s Business in Britain report, more than half of British companies are struggling to recruit the staff they need. On top of this, we also have higher global rates of inflation and low interest rates. City A.M. published an article entitled Low interest rates and high public spending drag down productivity. It includes the damning statistic that “output per hour in the UK has averaged just 0.2 per cent per annum growth. This is one tenth of its long-term average.”
But is it all really doom and gloom? The Economist had a different perspective on rising inflation. It commented that “The story for 2017 is not of inflation running too hot but rather of a welcome easing of fears of deflation.” It also noted other positive economic indicators such as the revival of commodity prices. A weaker pound has led to a boon for exporters with forecasts revised for factory output for this year and next year to 1.3% and 0.5% – up from 1% and 0.1% respectively. So, although there’s an element of UK low productivity holding back wage growth and some uncertainty around Brexit, the UK economy continues to show sustained resilience. It has as good as full employment and has just posted GDP growth of 0.4%. And although the needs of every business differ, at Kreston, we’re here to help our clients navigate their way through the uncertainty. Here are just a few of the areas we can help:
• Guide you through the risks and opportunities in a changing environment
• Provide business planning to help maximise profits
• Implement efficient structures to manage your commercial and tax risk
• Review your successions plans to protect the future of your business
Looking forward, the most successful businesses will always be the ones that embrace change rather than shy away from it. In an article in Forbes, Linda Peia analyses how entrepreneurs cope with uncertainty. Out of her five points, the one that stood out the most for me is to “face uncertainty with a strong sense of pragmatism and resilience”. And that’s exactly what we try to do here at Kreston. When we sign off with “Knowing You”, we’re underlining our understanding of the pressures and aspirations you have – because we’re right there with you, providing you with the knowledge and skills to help take your business to the next level.
You may also be interested in
“The China One Belt, One Road is going to be the new W.T.O – like it or not.” These are
“A crushing, horrible, unfair disaster”. That’s how President Trump described inheritance tax; he aims to abolish it by 2025. Other
Artificial Intelligence (AI) has been garnering a lot of media attention of late. And for good reason – its potential
Earlier this month, the Senate voted in Donald Trump’s controversial $1.4 trillion tax reform bill by the narrow margin of
To say that there’s been a backlash against globalisation in recent years would be an understatement. From demonstrations in France
“May you live in interesting times” goes the Chinese expression. In fact, it’s actually more of a subtle barb to
Earlier this month, the Slovenian Prime Minister, Miro Cerar, stated that he “want[s] to position Slovenia as the most recognised
In the UK, they’re known as Generation Y, in Germany Generation Maybe, and China has labelled them as the generation
Rodney Sutton, head of manufacturing at Kreston Reeves, recently shared his thoughts on the UK manufacturing industry following the referendum
The adoption of international accounting standards has brought many benefits to the private and public sectors. This being said, there
Remote working is becoming a way of life for many professionals and the ability to work in a variety of
A common global language for business affairs, IFRS Standards are required by more than 120 jurisdictions in the world. Recently,
Automated technologies and artificial intelligence in our society will challenge many professions in the future. Some of them may be
Crowdfunding is still relatively new but should still be considered as a viable source of equity. Nowadays, it is providing
A legal amendment to the Finance Bill recently accepted by the UK government may pave the way for big changes
In the business world, there are bumps on the road and financial setbacks. In this situation, it is easy to
Day by day, technology is becoming an essential part of our lives, as the way we manage our financial life,
A new generation is coming to challenge the market. The Millennials make up a quarter of the US population and
Managing change is one of the biggest challenges for businesses as it requires a huge effort from managers and organisations
Sustainability reports are released by companies and organisations of all types, sizes, and sectors, from all over the world. A
Accounting is an indispensable tool for entrepreneurs to manage their business. The data provided by competent
Thinking about the risks involved in business has become an essential part of an enterprise’s strategy. Risk management enables organisations
When a business does not achieve its expected results, it may be time to think about implementing change. In these
The Financial Times recently reported the dispute in the courts between the UK supermarket chain Sainsbury’s and MasterCard. The Competition
For many, the accounting profession may not seem the most attractive in the world. But with technology and innovation at our hands, this is about to change.
By following these five steps, communication has everything it needs to flow better, regardless of where your business is located and where the people you
The need to go global is something that has emerged over the past decade and promises to challenge business for the next coming years.
Recently a considerable change in the SME market was announced through business news on the internet. The Big Four have
There are five topics that we must remember when dealing with working personal relationships in international business…
Slowly, one of the last socialist countries in the world is preparing to make changes to its economy, but how will this be done?
Developing countries attract the attention of investors by offering good opportunities and new markets, making them attractive for anyone thinking of expanding their
Through a mobile app, a small business can promote its brand, products, and services, expand its sales channels, interact with the target audience and get
Last month, experts at the Milken Institute Global Conference in Los Angeles looked at certain megatrends and predicted several economic scenarios for 2040 to
When a business does not achieve its expected results, it may be time to think about implementing change. In these