UK Economy Could See Substantial Boost Through SME Technology Investment
In a potentially significant revelation for the UK economy, new research suggests that a £79 billion boost could be realised within the coming year if small and medium-sized enterprises (SMEs) were to prioritise investment in new technology. This economic uplift could lead to additional Exchequer receipts surpassing £25 billion annually through taxes on income and expenditure. These gains would exceed the £22 billion currently identified by the Chancellor as necessary to address the public sector's financial deficit.
Commissioned by Three Business, this research draws on economic analysis and a YouGov poll involving over 2,000 SME respondents. Within the survey, two out of five SME business leaders indicated that productivity would rise with investments in artificial intelligence and digital technologies, while 43% believed such investments would enhance their speed and efficiency.
Despite the apparent benefits, concerns persist among SMEs. Approximately 42% of these businesses worry that challenges in onboarding new technologies might stifle their growth, and over half (55%) cite the associated costs as a significant concern. Moreover, 42% are unable to prioritise technology investments, and 43% feel they are missing out on the opportunity to leverage emerging technologies.
Reliable and high-speed internet connectivity emerged as critical for almost all SMEs, with 97% and 94% respectively identifying these factors as important. These priorities outranked other considerations like good local transport links (64%), sufficient office space (69%), and access to skilled labour (83%). However, over half of the businesses (53%) reported that inadequate mobile connectivity could impede growth.
Currently, the UK's connectivity infrastructure poses a challenge. The country ranks poorly in terms of 5G availability and download speeds, positioned 22nd out of 25 European countries. London fares worst among major European cities, and the UK’s network speed ranks 26th out of 31 European nations.
Mike Tomlinson of Three Business noted, "Technology is a key driver and enabler of growth for businesses, which are central to the UK economy. This was a focal point in the Government's long-term Industrial Strategy, published last week, highlighting support for tech sector growth and technology adoption to enhance productivity." He added that a proposed combination of Vodafone UK and Three UK could lead to £11 billion in investment towards mobile infrastructure, aiming to establish a leading 5G network that fosters economic growth and innovation nationwide.
Anthony Impey, CEO of Be the Business, spotlighted the crucial role of SMEs as a driving force within the UK economy and their integral part in the government's growth and opportunity mission. He emphasised the dedication of SME leaders, often working extensive hours, and acknowledged the necessity of employing new technologies, including Generative AI, to boost productivity and support innovation and growth.
These findings underscore the substantial economic benefits that could be attainable from technological advancements among SMEs, despite the existing connectivity constraints hindering these enterprises.
Source: Noah Wire Services