18 Dec The Challenge for Small and Medium Businesses Post Recession
The Challenge for Small and Medium businesses Post Recession
It has been a tough few years for small and medium businesses and those of us operating in this space have undoubtedly felt the pain of the financial crisis. Our biggest challenge now is our lack of investment during the bad years, which in many cases has been forced on us, due to weak earnings, economic uncertainty, and the decision by banks to stop lending to all but blue chip companies with lots of collateral to offer.
Thankfully, we are now seeing moderate growth rates in the UK and the United States, driven by consumer demand and low inflation. In the United States, labor markets have improved, buoyed up by a stronger dollar and lower oil prices. US based small and medium businesses have created more jobs in the last 3 years than were lost during the financial crisis. This is similar in the UK, where new jobs have increased to pre-recession levels in 2014 and 2015. In general, the UK’s small and medium businesses have recovered from the recession, with growth and start-up rates returning to pre-2008 levels, according to the Enterprise Research Centre (ERC).
Despite the positive economic indicators, not every business is benefiting to the same extent. Also, the availability of bank financing is still to return to pre-recession levels. This shortage of bank financing impacts investment confidence and prevents small and medium business owners investing in their businesses. Check out the longer version of this article below to identify what small and medium businesses should now do differently.