South East: Close Brothers reports SMEs lukewarm about 2017 prospects

According to the Close Brothers Business Barometer, almost three in every five (57%) of SME business owners in the South East say they do not feel confident about the UK’s economic outlook for 2017. The quarterly survey questions over 900 UK SME owners and senior management across a range of sectors and regions.

Firms at the smaller end of the scale – under £500,000 annual turnover – were the least confident, with 64% answering ‘no’ to the question ‘are you confident about the UK’s economic outlook for 2017?’.

Neil Davies, CEO of Close Brothers Asset Finance, said: “There are still many unknowns and this uncertainty is reflected in what small business owners are telling us. For example, the value of sterling is seen as a short-term issue and doesn’t create conditions for long-term investment. While activity in a number of sectors is stronger due to the weaker pound, and is helping to boost orders from overseas, cost pressures remain high with price increases being passed onto consumers, which may contribute to an increase in inflation down the road.” 

The most enthusiastic sector was manufacturing, which returned a positive response of 61%, followed by engineering with 52%; construction 49%; transport 47%, and print 37%.  

Davies commented: “UK manufacturing is on a high at the moment, with recent rates of growth for production and new orders among the best seen over the past two-and-a-half years, according to the Markit/CIPS purchasing managers' index.”