UK technology companies are planning to expand and recruit new staff over the next six months, despite concerns that the economy will be stagnant, according to a survey published today by Intellect, the trade association for the UK technology sector.
Company bosses who took part in the survey painted a surprisingly positive picture for their own businesses over the past six months, with 51 per cent saying their business prospects had improved or stayed the same 34 per cent, while 60 per cent said their company had increased its level of business investment in the same period.
However, on the wider economy 52 per cent said that over the past six months their confidence about the state of the economy had stayed the same and 40per cent said it had decreased. While only 22 per cent thought the general economy would improve in a year’s time.
Looking at their own business prospects for the next six months 67 per cent said they plan to expand with 43 per cent saying they were very likely to recruit new staff. A further 40 per cent said they would possibly hire new staff.
Regarding the government’s general economic policy the survey showed that the tech sector supports the government’s deficit reduction strategy (87 per cent either very supportive or supportive) however, only 21 per cent thought the government would meet its deficit reduction target.
There was also a big thumbs down for the government’s plan for growth, with 67 per cent saying they were not confident in the plan and zero per cent saying they were very confident in it. The sector does support the idea of the government taking a more active approach to industrial policy, with 61 per cent saying they should develop a modern industrial policy.
The industry is also behind Chancellor George Osborne’s ambition, stated in his last budget, to make the UK “the technology centre of Europe” with 81 per cent saying the country has the potential to achieve this goal. However, they were less convinced that the government really understands the UK tech sector. In response to the question “how well do you think the government understands the UK tech industry” 66 per cent said “not very well” and zero percent said “very well.”
Commenting on the survey Antony Walker, Intellect’s deputy director general said: “There is clearly a divide between how confident business leaders feel about the prospects for their own business compared to the economy as a whole. Despite the difficult It appears that companies have invested during this year and are now looking to maximise that investment. However, if the storm clouds gather again across the wider economy these gains could be quickly lost. The industry agrees with the chancellor that technology can be an engine for growth, but the worrying thing is that business leaders don’t feel the government fully understands the sector and the opportunities it can create.
There is clearly a major challenge ahead for the Chancellor to deliver confidence boosting measures in his autumn statement and we will be continuing to press him to put technology firmly at the centre of the government’s growth strategy.”
“One area where our members continue to express concern is around skills shortages, both in the short and long term and this will have an impact on the ability of companies to turn their ambitions into real jobs,” added Walker.