There was some positive news coming out of the United Kingdom about their economy, as they enjoyed nearly 2% growth last year. This marks a huge improvement from the past few years, even if not quite up to the same level as the mid-2000′s. UK leads the EU in economic growth with this statistic. What’s more, manufacturing orders hit a three-year high, according to the Industrial Trends Survey by the Confederation of British Industry’s latest report. A third of businesses reported an increase while just a fifth reported losses. Even the International Monetary Fund has joined in the optimism, upgrading it’s economic growth forecast for the United Kingdom to 2.4% for 2014.
A recent article from Forbes takes a harder look at all this optimism, though. While these numbers are great, it is mostly a result of success of large companies. The truth is that small and medium sized companies are still having a hard time financing their growth, which is potentially hurting the chance for new players to get into the game, and potentially harming innovation and new ideas.
This sudden and welcome economic growth has been spurred on largely by a slowly recovering housing market and consumer spending. How long can this growth be sustained on the backs of consumer spending? That’s precisely what the Business Minister is wondering.
The goal is to achieve sustainable growth with long-term potential. And for this, we need small and medium sized businesses to thrive. These businesses account for 50% of employment in the private sector in the UK. While looking at overall positive numbers, we ought to be considering that lending to businesses is down nearly two billion pounds from last month, more than half of which were for small and medium sized businesses.
The government is introducing initiatives to provide these businesses some access to finance in lieu of traditional methods like bank loans. The real job, apparently, is to get the word out about these options. Business owners need to know about resources before they can provide assistance. Across six plans, the government is prepared to fund nearly three million pounds. Six thousand businesses have received some funding through these initiatives. Funding is also being provided to banks with the understanding that they will lend to smaller businesses and households. More plans are in the works.
However we get there, it is paramount to a sustained recovery that we keep small businesses in mind.
from Mark Tuminello http://ift.tt/1bdwkTx – latest post by Mark Tuminello