Brexit: Expert discusses UK’s ‘vision’ and predictions
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A record number of finance bosses at the country’s biggest companies are aiming to ramp up capital spending in the next year, according to research by consultancy Deloitte. Eighty-five finance chiefs at firms which have a combined market value of nearly £500billion, representing 19 per cent of the entire UK stock market, were surveyed as part of the report. A third of chief financial officers (CFOs) at Britain’s premium listed firms are looking to scale investment to take advantage of surging domestic and foreign demand.
More than nine in ten CFOs are intending to expand their technological capacity.
Finance bosses are also expecting their gamble on investment to pay off, with 84 percent predicting it will yield productivity enhancements.
Britain spends a huge $43billion (£31.6billion) on research and development (R&D), making up 1.6 percent of the size of the country’s economy, which is more than the likes of India and Russia, according to figures from Unesco.
Following Brexit, UK businesses are growing in confidence about their operational abilities.
Brexit news: UK businesses are preparing to unleash a wave of investment (Image: GETTY)
Brexit news: A record number of the UK’s biggest companies are aiming to ramp up capital spending (Image: GETTY)
Ian Stewart, chief economist at Deloitte, said: “Like equity markets, which rallied into the new year, CFOs seem to be looking past Omicron and plan to focus their businesses on growth in 2022.
“It is a measure both of the remarkable snap-back in activity from the pandemic and the scale of the challenge today that CFOs rate labour shortages as the greatest risk to business.
“This is ahead of even the pandemic, in second place.
“Strikingly, the worries that dominated the risk list in recent years – above all Brexit and weak global growth – have dropped sharply down the risk rankings.”
Brexit news: The UK and EU signed a trade deal at the end of last year (Image: GETTY)
Richard Houston, senior partner and CEO of Deloitte, added: “CFOs are going into 2022 with their sights set on expansion. Investment in technology and skills are key priorities for business as they seek to grow, innovate and build resilience.”
But on the flip side, the study from Deloitte suggests businesses are coming under increasing pressure to stay afloat amid a barrage of soaring costs and an ongoing labour squeeze.
Just over half (54 percent) of finance bosses highlighted surging inflation as a major risk to their businesses’ performance.
Slightly more (58 percent) are worried about a continued shortage of workers.
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Additional research published by consultancy BDO also revealed concerns about the impact higher inflation will have on the business environment.
Over the last month, optimism has fallen, driven by the threat of inflationary pressures hitting home this year.
It has also surged due to the impact on consumer confidence from the Government’s Plan B restrictions to restrict the spread of the Omicron variant of Covid.
Kaley Crossthwaite, a partner at BDO, said: “Ongoing uncertainty around Omicron is providing a further blow to UK businesses which have already battled a string of supply chain issues, the threat of further covid restrictions and inflationary pressures this past year.”