SME stagnation looms

UK SMEs experience 20% decline in growth figures

A monthly SME Recovery Tracker from ACCA (the Association of Chartered Certified Accountants) and The Corporate Finance Network (CFN) reveals UK SMEs have experienced a steep drop of 20% in growth figures. In April this year, 94% were actively looking to grow their business, however current figures are now significantly lower at 75% which would lead to stagnation if this trend continues.

The monthly SME tracker survey, which polls accountancy professionals on the financial outlook of their SME clients, shows that a large proportion of UK SMEs are experiencing mounting concerns about the current state of the UK economy. A further 7% of UK SMEs predict they will run out of cash in the next 12 months, raising considerable concern for their survival.

Hiring and training slip off the business agenda

SME stagnation is also being felt across other important lines of business such as recruitment with just 12% anticipating having more people on the payroll. This is another sharp decline from earlier this year in March (37%) and serves as a strong signal on investment. Similarly, training programmes have also experienced a standstill, with almost half of businesses admitting to not finalising recruitment and training programmes for the next six months. This all points to the fact that attention has been diverted to critical business specific issues at a time of uncertainty as SMEs operate in crisis mode. 

Capital investing tax relief to bolster SME growth

Continuing economic uncertainty and supply chain disruption means it’s now crucial to get the right support in place to encourage SME investment. With the existing ‘super-deduction’ incentive due to end next spring, firms need an early answer on its replacement.

Glenn Collins, Head of ACCA said: “The decline in SME optimism has clearly had an impact on business investment. The stark recruitment figures demonstrate the stalling of investment in other lines of business and this is also filtering down to its people in terms of recruitment and development programmes. Businesses are having to deal with soaring costs as well as supply chain bottlenecks which are having a huge impact on how they conduct business in a timely manner - as well as their ability to make capital investments. Our businesses need some certainty in these uncertain times. Ultimately, employment, training and other investment tax reliefs and capital allowances should extend into the next parliamentary term. The next Chancellor needs to prioritise creating certainty to invest and extending investment opportunities; which will be crucial to economic recovery as well as sustained growth.”

Kirsty McGregor, founder of The Corporate Finance Network, adds, “As our research suggests, it’s extremely concerning to see that 7% of UK SMEs are expecting to run out of cash in the next 12 months. Ongoing economic strains are clearly taking effect and impacting other lines of business - all of which are only set to exasperate growth further. A review of the function and effectiveness of the British Business Bank is long overdue and I would urge the next Chancellor and Business Secretary to prioritise this.’


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Notes to Editors
This edition has sought views from accountants working in practices advising some 48,500 SME clients.

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About The Corporate Finance Network: The Corporate Finance Network – - The Corporate Finance Network consists of some of the most proactive and commercially astute regional, independent accountancy firms in the UK. They specialise in providing corporate finance advice for smaller transactions. Kirsty McGregor can be contacted at

"The stark recruitment figures demonstrate the stalling of investment in other lines of business and this is also filtering down to its people in terms of recruitment and development programmes."

Glenn Collins - Head of ACCA-UK