News in brief: Christmas, Scottish Budget, finance

News in  brief
News in brief

Nearly half of SME owners have to work Christmas Day

Nearly half (49%) of SME decision makers have worked on Christmas Day, according to Zurich’s latest SME Risk Index. Despite being a national holiday, nearly one in five (18%) SME decision makers have had to go into work on Christmas Day, and nearly a third (32%) have sacrificed the festivities to check and send work emails.

Not only have SME decision makers had to work over the Christmas period, they’re also losing out on annual leave. Data from Zurich’s SME Risk Index reveals one in ten (14%) decision makers have not taken any annual leave this year and in addition, almost one in five (18%) have not had more than 10 days off this year.

Zurich head of SME Jason Eastock says: “It will come as no surprise to SMEs that despite commonly held views about the lifestyle benefits of working for yourself, the reality can be very different. Missing big events such as your child’s nativity play is a high price to pay and shows the pressure many SMEs are under.

“As we look forward to taking some rest over the Christmas season, it seems current economic and political concerns are driving many of our small business owners to carry on working. We hope that everyone gets a chance to enjoy the holidays and as ever we offer our support to make their businesses run as smoothly as possible during the festive season.”

Investing in skills will strengthen the economy

A 10% increase in professional and technical skills over the next ten years could increase UK GDP by £163 billion by 2025, according to a new report commissioned by the City and Guilds Group. The report highlights that increasing the number of 16-18 year olds enrolled in skills education could lead to a 1.5% reduction in youth unemployment in the UK.

The findings complement the UK Government’s ongoing investment into apprenticeships. Previous research by Cebr and the Skills Funding Agency showed returns of between £16 and £21 for every £1 invested. Between 2010 and 2011, the UK government invested £1.2 billion into apprenticeships and in 2010 saw a total economic impact of £25.3 billion.

City and Guilds Group chief executive Chris Jones said: “This report shows that given the high returns, investing in professional and technical education is a safe bet for individuals, employers and economies. It helps to fill skills gaps, boost productivity, enhance industries and increase employment.

“However, while professional and technical education offers so much potential, there are still challenges that are getting in the way– from too little data on the benefits of skills education, to overly complex skills systems and minimal employer involvement. Governments across the world need to understand these challenges and work with employers and education providers to tackle them head-on.”

CBI Scotland responds to Scottish Budget

The Confederation of British Industry has responded to the announcement of the Scottish Budget, saying it is pleased to see the Scottish income tax rate unchanged and calling for a long-term roadmap for business taxes.

CBI Scotland Director Hugh Aitken said: “Companies will also welcome the business rates review and the CBI looks forward to working with the Government ahead of its conclusion to ensure rates remain competitive. But companies will be seeking urgent clarification from the Government on the proposed increase to the large business supplement and other reliefs, which could affect investment intentions.

“Elsewhere, while firms back further investment in the modern apprenticeship programme concerns remain about the impact of the new UK levy. They will want assurance that resulting revenues from businesses will be ring-fenced for apprenticeships.”

UK manufacturers are underprepared for the future

Despite 86% of UK manufacturers being confident about the future, almost a quarter do not plan for the implementation of new technologies (22%) and do not have personnel succession plans put in place for their staff (24%), according to a survey by FANUC UK.

Other key findings from the report include:

• SMEs are more likely not to have a succession plan in place with over a third (35%) admitting they don’t plan for staffing

• The main obstacle to the success of the business is competition in the market (18%), closely followed by UK economic conditions (14%) and international economic conditions (12%)

• Manufacturers are investing in and reliant on technology with almost a third (31%) of UK manufacturers planning to invest more in manufacturing technology in the next two years

• A third (33%) of all manufacturers in the UK said they have become more dependent on technology over the last year, with 89 percent of manufacturers agreeing (46%) and strongly agreeing (43%) with the statement that “keeping up with new technology is important to the success of my company”

• Production line automation is the most important technology to their business (50%) followed by IT (39%), and telecommunications (7%).

• The main drivers behind technological adoption are business owners (38 per cent) and customer demand (37%)

Birmingham City Council chooses Obillex solution to help SMEs access finance

Birmingham City Council has announced that it has made a £500,000 investment in a solution that offers its small to medium-sized business suppliers access to finance quickly and more cheaply than generally available.

The City Council has taken a stake in supply chain finance specialist, Obillex, which it recently appointed to provide a new supply chain finance technology platform. Birmingham has been attracted by its potential application in large buying organisations across the country and the boost it can give to local, regional and national economies.

The Obillex supply chain finance system leverages the City Council’s creditworthiness to attract funding from investors to allow rapid payment of suppliers’ invoices. The cost of the finance is kept low as investors are willing to take a small return on each transaction due to the potential high volumes involved and the low risk based on the Council’s good credit rating.