Barclays has launched a major initiative to bolster UK businesses with a £22bn fund and a new Business Prosperity Index, signalling a move towards economic growth.
- The Business Prosperity Index, created with Cebr, integrates data from over one million Barclays business clients to assess business sentiment in the UK.
- Initial findings indicate a 1.4% increase in planned investments year-on-year, with many businesses resuming paused investment efforts post-Budget.
- Despite economic challenges, a significant percentage of business leaders are optimistic about the UK’s economic direction, encouraged by improved cash flow and investment in training and development.
- There are ongoing challenges with skilled labour shortages, adapting business strategies, and inflation, yet businesses remain proactive in expanding offerings and adjusting pricing structures.
Barclays has taken a significant step to support the growth of UK businesses by introducing a £22 billion fund alongside a new Business Prosperity Index. Collaborating with the Centre for Economics and Business Research (Cebr), the index aggregates data from over one million Barclays business clients and includes insights from 1,000 business leaders. The inaugural findings of the index suggest a positive outlook for UK business growth, marked by a 1.4% rise in planned investments year-on-year.
A substantial number of businesses have resumed previously halted investment plans following the recent Budget announcement, with 46% back on track and 37% seeking further funding opportunities. The newly launched Prosperity Fund is designed to facilitate access to finance for UK businesses, accommodating both new and existing clients within the Business and Corporate Banking sectors. Matt Hammerstein, CEO of Barclays UK Corporate Banking, expressed cautious optimism, stating, “Our data shows many businesses are ready to kick-start growth by seeking the funding they need.”
The survey results from the inaugural Q3 report highlight the strong financial resilience and appetite for investment among UK businesses. Specifically, there is a 17% increase in net cash flow per year, indicating effective management of financial outflows. However, workforce shortages remain a formidable obstacle, with Scotland, Yorkshire and the Humber, and the West Midlands experiencing the most severe shortages. Businesses are prioritising investment in headcount growth and training initiatives to bridge the skill gap.
Businesses are navigating the aftermath of inflation’s peak by tailoring strategies to remain competitive amidst high production costs. Over half of the firms aim to diversify their product ranges, while a significant percentage have introduced new pricing models, including special offers and shrinkflation, to engage customers. Hannah Bernard, Head of Barclays Business Banking, underscored the utility of the Business Prosperity Index as a tool for navigating the economic environment and accessing necessary growth resources.
Barclays’ initiatives reflect a commitment to bolstering UK business confidence and addressing economic challenges with strategic funding and resources.
