62% of SMEs have made or are planning to make redundancies following the COVID-19 pandemic, equating to 1.4 million jobs at risk, according to new research from Sage.
The ‘Survival, Resilience and Growth’ report also revealed the economic recovery is likely to trigger a significant restructuring of the workforce where managerial roles and London jobs are the most at risk. It maps out sectors and regions that are most resilient, at risk or likely to grow.
Despite the stark outlook, Sage’s report revealed that British SMEs are bullish about the future, making bold moves to improve processes and productivity, access new markets and improve their relationships with customers.
Three quarters (75%) expect to be profitable by June 2021, while nearly half (47%) are taking measures to increase export revenues.
The report also highlighted that 80% of SMEs think digital adoption will be critical for an enterprise-led recovery and job creation, but only a small proportion (33%) have the bandwidth to invest in technology across key business processes.
These businesses would benefit from support to invest in technology, with 40% saying that a technology grant from the Government would allow them to increase hiring.
“Businesses have had to radically change their plans and strategies, adapting to unprecedented ways of working. But this has created the potential to drive up productivity, especially where processes have been digitised,” said Sabby Gill, Managing Director of Sage UK and Ireland.
“We have some tough months ahead with many unknowns so if we can help businesses access finance and technology and reduce exposure to risk, we will see new jobs emerging.
“The measures announced by the Chancellor are encouraging but we need to go further. Sage, on behalf of the country’s SMEs, is calling on the government to act now and take a three pronged approach to aid digital adoption, help to boost exports and provide tailored support that encourages entrepreneurialism by equipping the unemployed with essential business skills.”
With only 54% of businesses prepared for challenges that may lie ahead – stability and a business-friendly operating environment will be vital.
To help UK businesses adapt to the ‘new normal’, Sage is calling on the Government to take action in the following areas:
- Introduction of immediate support to invest in technology
- Create new jobs by encouraging and helping the unemployed to start a new business
- Help SMEs in many more sectors boost trade and reach new markets.