CBI, the UK’s principle business lobbying organisation, released a report last year suggesting UK SMEs were the main heavy lifters during the economic recovery of 2014. In spite of growing concerns regarding the global economic crisis, the UK actually performed quite comfortably last year when compared with other countries.
GDP enlarged by 0.7% in the third quarter of 2014 – a figure 3% larger than the previous year. Britain performed a lot better than expected in 2014; expanding at a faster rate than all G7 nations, excluding the United States.
Annual income for small-to-medium size businesses grew by 7.4% across the entire year, as reported in Barclays’ Small Business Income Index. This report is assembled by industry experts that collate income information from around 600,000 SME clients. All of these customers have a turnover of less than £5m but the list is altered regularly to account for short-term instability.
7.4% represents the largest annual growth rate since before the turn of the millennium. Perhaps even more promising is the 1.8% increase from quarter 3 to quarter 4; which is usually a quiet period for such inflation.
Good All Round Performance
This trend was particularly noticeable in and around London, the North West and the Midlands. Although in general, most of the country’s regions have enjoyed a solid year in 2014. In particular, health, property and education sectors enjoyed the most success and witnessed the greatest income levels compared to others in the same period.
These figures have been advocated and praised by Barclays’ Head of Business Banking, Adam Rose, who has high hopes for the rest of 2015. The GDP figures for 2014 highlighted growth of 2.6% overall – backing up the figures shown by income growth in SMEs’ in the same year. Mr Rose points out that these are the healthiest figures for small business growth “since before 2001” and creates a feeling of optimism and drive for businesses to “get a head start in 2015.”
Despite the growth reported, many SMEs still face frustration when it comes to sourcing business finance, potentially blocking further expansion and development and stunting the economy. Find out more about your business funding options here.