Vistage, the world’s leading business performance and leadership advancement organisation for small and medium-sized businesses, has released its quarterly SME CEO Confidence Index for Q4 2023; highlighting economic predictions for the new year.
Growth Is On The Horizon
More than half of all business leaders (56%) in the UK and Ireland believe that economic conditions in the country have either improved, or remained the same.
Overall business confidence has increased to 105.8 points, up 11 points from the last quarter, with 77% of business leaders feeling economically optimistic for what the New Year may bring.
This year SMEs have forecasted that financial conditions will improve within the next 12 months alone:
63% of business leaders anticipate an increase in revenue in 2024
53% expect to observe an increase in profitability within the next 12 months
56% are budgeting to increase the number of staff to help support growth this year
The Talent Shortage Continues
Despite the overwhelming optimism, a majority of SME business leaders (40%) recognise the current talent and skill shortage as the biggest challenge towards growth.
At present over half (51%) have found that hiring challenges have severely impacted their ability to operate at full capacity. As such just under a third (29%) of business leaders are actively budgeting for larger pay rises this year in a bid to retain top talent.
Additional challenges identified by SME business leaders for 2024 include:
Domestic and international economic and political issues (29%)
Rising inflation (9%)
The digital transformation process (5%)
Sustained supply chain disruption (5%)
Cyber Awareness Laxes
In 2023, 27% of SMEs fell victim to a cyber-attack. While a vast majority (93%) of these attacks did not result in compromised or lost data, only 60% of business leaders have a regularly reviewed cyber security plan set in place.
In fact, a quarter of all businesses do not have a defined cyber security risk strategy in place, a further 15% haven’t reviewed their cyber security strategy in the last year indicating a more laxed attitude towards cyber security.
Vistage, MD International Operations (UK), Andy Perkins, commented: "As we enter a New Year, it’s refreshing to see economic confidence re-appear for a majority of business owners and leaders across the UK and Ireland after a tumultuous 12 months."
"That’s not to say 2024 will be plain sailing, or that economic challenges can’t or won’t change. That’s why for any business leader it is important to take this as an opportunity to really focus on boosting productivity and sustaining growth as a means to build up a competitive edge.”