London’s smaller firms upbeat despite fears of UK triple-dip recession.
Please see below online coverage in the Evening Standard.
18 January 2013
London’s smaller firms are bucking a miserable economic backdrop as the rest of the country braces itself for a triple-dip recession, an exclusive survey reveals today.
Confidence recovered in the final three months of 2012 after a difficult third quarter as fears over a eurozone break-up receded, according to the latest London Business Monitor, produced for the Evening Standard by Western Union Business Solutions.
The monitor, which takes the temperature of more than 200 small businesses in the capital, found 52% of small and medium-sized firms confident in the current climate, up from 45% previously.
A quarter of London’s firms also plan to take on more staff over the next year, against just 8% planning to reduce numbers.
The more positive news from the capital comes a week ahead of official growth estimates in danger of showing a fresh decline for the British economy between October and December.
Jonathan Rees, WUBS’s managing director for the UK, said: London SMEs have seen a relative improvement in confidence after a tough third quarter. The impact of the eurozone crisis continues to be felt in the capital but it is encouraging to note that less than a quarter of SMEs expect to be negatively affected in the future.”
There are reasons for optimism as we head into 2013, but it’s a case of cautious optimism at best, he added.
London’s smaller businesses are still reluctant to approach banks for loans with just a quarter of them applying for credit during the last quarter, of which 71% were successful.
The monitor reveals 24% of companies considering alternative methods of financing, up from 18% in the previous quarter. The survey also shows that there is widespread scepticism over the Government’s plans to launch a business bank.
Rees said: The need for better access to funding is vital as London’s small businesses are continuing to turn to their own resources as they fight to stay competitive in the global marketplace.