Member Article

UK PLC predicts poor economic news to continue

Businesses expect the tough economic conditions to continue throughout 2013, according to a new report by Business Environment, one of the UK’s leading serviced office providers.

The firm commissioned an independent poll of 300 senior businesspeople, who reported pessimism about the direction the economy was taking. Just 33 per cent of respondents believed that the economy’s fortunes would turn round during the course of the year, while only 37 per cent believed that the government’s economic approach would be vindicated. However, there was good news for the Euro – when asked what event was most likely to happen over the course of the coming year, more people picked the end of the Euro crisis (39 per cent) than predicted the failure of the Euro (20 per cent).

David Saul, managing director of Business Environment, said: “With the exception of Europe, from where we are glimpsing some rare positive signs, the clear feeling in the business community is that the constant flow of gloomy news will not abate any time soon. Companies have become reconciled to austerity, and it now feels like a permanent thing.”

However, despite the downbeat predictions for the economy, companies were not as negative when it came to their own prospects – a large minority (44 per cent) felt that 2013 would be a good year for their firm.

David Saul said: “Faced with what feels like a permanent recession, firms are learning to adapt to reduced demand and less available credit. While few firms are thriving, many are cutting costs, innovating or changing their business model, and are learning to make the best of a bad job.”

The survey also predicted that while the economy was unlikely to get better soon, it was less likely to become dramatically worse – only six per cent of respondents argued that 2013 would see a further macroeconomic shock comparable to the credit crunch.

This was posted in Bdaily's Members' News section by David Saul .