Political and economic challenges remain for UK business in 2018

The same external and internal political, economic and market challenges remain for businesses for this year as they did for 2017 according to the new research by ICAEW. Despite improved global conditions, uncertainty about the UK’s relationship with the EU continues to be the biggest concern for business.

Key headline findings from the report include:

• The majority of businesses still expect that uncertainty surrounding the UK relationship with the EU could affect them negatively (65% vs 68% in 2017)
• Over a third (36%) of businesses believe that immigration policy on EU migrants could negatively impact their activity in 2018. This is the same as 2017 but more than doubled since 2016 (14%)
• The availability of skilled workers is expected to be a continuing challenge (at 44%, in line with 39% for 2017) across businesses of all sizes 
• Despite a recent interest rate rise, only 43% feel rises would have a negative impact in 2018, similar to 47% in 2017
• 40% of all businesses feel that the value of the pound relative to other currencies could cause problems in the year ahead, which is significantly lower than 48% in 2017

Matthew Rideout, ICAEW Director of Business, said: “We are facing the same challenges in 2018 as we did over the last twelve months. If Brexit talks can lead us swiftly to a full transition deal and a longer-term trade deal, then the horizon will get a little brighter for 2018. It is very easy to overlook some important improvements. Sparks of confidence and opportunities are there, especially in global markets but need to be ignited further. Businesses should look beyond Europe and take the initiative to invest in technology, training and development.”