‘Engine of the UK’s economy’: Mid-sized firms set to ramp up investment in boost to growth
More than half of the UK’s mid-sized firms plan to invest at least £3m in the next five years in order to scale up their business.
Fifty-one per cent of mid-sized companies, which comprise those with turnovers of between £10m and £300m and account for one in four UK jobs, will ringfence the sizeable amount of capital expenditure, a survey of business owners found.
The research, which polled 500 firms, also found two-fifths of respondents plan to direct the majority of that investment within the UK, in a boost to jobs and productivity.
The survey’s findings will be welcome news to watchers of the UK economy, which has been stagnant for much of the past fifteen years due largely to a lack of public and private sector investment.
Latvia, Slovenia and Hungary all attracted higher levels of private sector investment than the UK as a percentage of gross domestic product (GDP).
Almost a quarter of the firms surveyed said that securing new capital – be that through private equity, venture capital or credit – was one of their top priorities for the rest of the year.
The poll, which was conducted by the accountancy BDO, also found nearly half of mid-sized firms want to the new government to make it easier for smaller business banks to enter the market. And a third want to see simpler regulation around listing on the Main or Aim market.
Richard Austin, partner at BDO, said: “With a new government in place and inflation hitting the Bank of England’s two per cent target in May, it looks like businesses may have some reason to be optimistic after years of challenging economic conditions and uncertainty.
“Mid-sized businesses are the engine of the UK’s economy, and their desire to invest is good news for the new government. Policymakers need to follow their lead and create an environment where they can flourish and achieve their ambitions for growth.”