As the nation begins its phased unlocking and reopening of the economy, more than a third (35%) of small firms who responded to Virgin Money’s Business Pulse report said they anticipate investing anywhere between £10,000 and £10 million in 2021.
This represents a year-on-year increase of 32%, with most small firms forced to tighten their belts and enter survival mode during 2020’s COVID-19 pandemic.
Almost half of small and medium-sized enterprises (SMEs) surveyed planned to expand their workforce to support expansion plans, while more than a quarter (26%) were confident recruiting more staff once the economy shows signs of life.
The study also highlighted a surge in business start-ups nationwide. The number of new firms created reached record highs in Q4 2020, with the annual growth rate of registered companies soaring to 8.3%.
The UK saw over 90,000 additional new start-ups formed in 2020 than in 2019. This is the highest the growth rate has been since the survey began in 2014.
The majority (57%) of small firms surveyed still had staff on furlough. The latest Virgin Money Business Pulse survey questions whether the Coronavirus Job Retention Scheme will be a long-term success. Less than a fifth (19%) of employers anticipate being able to retain all furloughed employees when the scheme concludes.
Gavin Opperman, group business director, Virgin Money, said: “It has been an incredibly challenging environment over the last 12 months, but our latest Business Pulse shows that many firms have adapted with incredible pace to the new environment, demonstrating extreme resilience and innovation to navigate through the difficult landscape.
“While there are undoubtedly significant challenges ahead, many businesses remain optimistic and intend to invest for the future as the economy recovers.”
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Last updated: 1st April 2021