Innovation is increasingly lagging behind Britain’s businesses as they focus more on survival strategies amid a bleak economic outlook and fears of recession. That’s the conclusion of a study conducted by management consultancy Magnetic, in which more than 300 female and senior managers were interviewed. Every second person surveyed said that innovation efforts in their company were stopped in order to invest primarily in survival. For 56 percent, protecting the company’s existence is the top priority. On the other hand, one-third of executives say growth and innovation are their top priority in the next six months.
Dark growth prospects
Companies face rising prices, weak consumer demand, high borrowing costs and a bleak growth outlook for the economy. There are fears that Britain could slip into recession. Two-thirds of companies with more than 250 employees and an annual turnover of one million pounds took part in the survey.
Nevertheless, those surveyed did not lose sight of the future. With artificial intelligence (AI) becoming increasingly important to the UK economy, almost 90 per cent want to invest in the technology. Additionally, 27 percent plan to improve cybersecurity in the next six months, while 26 percent plan to invest in IT infrastructure.
The government has put together an “AI powerhouse.”
The government has pledged £500 million over the next two years to fund innovation hubs to build the UK.AI Powerhouse“Closer. Global leadership in AI is the goal. Chancellor of the Exchequer Jeremy Hunt wants to ensure researchers and start-ups have access to the computing power they need. He has also promised permanent tax relief for companies investing in future technologies.
“A volatile economy, combined with geopolitical tensions and dramatically changing consumer perspectives, has placed a heavy burden on UK business leaders,” said Jenny Burns, chief executive of Magnet. Nevertheless, it is necessary to do more than struggle for survival.
Current data on the UK economy:
Gross domestic product (GDP) in 2022 is about 2.9 billion euros. The UK unemployment rate stood at 4.21 per cent in September 2023, representing a slight increase compared to previous figures. Projections indicate that the overall unemployment rate will rise by 0.1 percentage points between 2023 and 2028.
Great Britain’s export quota has fallen since Brexit. A large economy is the only country that has slipped into recession. Exporters have stopped selling into the EU and the proportion of small UK businesses exporting overseas has fallen since Brexit. It has been summed up as an “economic disaster” for the UK and the EU. There is significant planning and legal uncertainty and the risk of trade conflicts as the UK withdraws from the EU Withdrawal Agreement.
“Communicator. Entrepreneur. Introvert. Passionate problem solver. Organizer. Social media ninja.”