Accountants believe that more than one in four UK SMEs have still not returned to pre-Covid-19 levels of productivity or turnover
The latest Association of Chartered Certified Accountant’s (ACCA) SME recovery tracker revealed that four in five UK SMEs are not seeking finance to grow in the next six to 12 months with 30% of accountants stating that their clients will need to use an overdraft in the next six months.
A further third expects their clients to apply for secured or unsecured business loans within the same time period and nearly half, 45%, expect their clients to apply for eligible business grants.
The analysis, conducted in collaboration with the Corporate Finance Network (CFN), reported that over the last month alone, there has been a 10% drop in the number of businesses that are expected to still be trading in 12 months time, from 93% in November to 83.8% in December 2021.
It also found that the number of SMEs expecting to make redundancies next year has increased 4% from 8% in November 2021 to 12.4% in December. This equates to more than one in 10 businesses.
ACCA states that the current Covid-19 variant Omicron has increased uncertainty for a large number of UK businesses as lockdown rumours continue to circulate.