SMEs see the Spending Review as less of a threat than do managers of larger companies.
SMEs see the Spending Review as less of a threat than do managers of larger companies.
Among SME executives, 47 per cent perceive the Spending Review as a danger to their business compared to 60 per cent of managers in companies with 250 staff or more, according to a report by the Chartered Management Institute (CMI).
Lord John Eatwell, chief economic adviser to CMI, comments: ‘With the threat of immediate and major cuts on the horizon, widespread instability looks likely to remain a characteristic feature of the economic outlook for some months to come. Of course, it is unrealistic for employers to anticipate the flow of investment from government to improve significantly in the short term.’
The recession is still seen as having a negative impact on businesses according to 82 per cent of UK senior executives. Interestingly, 80 per cent of managers in larger companies see morale as much worse than it was six months ago.
Ruth Spellman, chief executive of CMI, says: ‘Ultimately, the key to recovery is ensuring that managers feel confident and optimistic about the future. It’s painfully clear that this just isn’t the case at present. Of course, managers and leaders must take some responsibility for developing the skills needed for success, but they are crying out for more support.’
More than half of SMEs have kept pay freezes in place, as have 71 per cent of larger businesses, and over two thirds of the larger companies are not currently recruiting new staff.
Eatwell adds: ‘If Government policy on deficit reduction and public sector reforms is to succeed, then highly skilled and capable managers will be needed. To enable investment in these skills, and to support business growth, the Government must do more to stimulate a reliable flow of bank lending.’
