Identifying barriers to productive investment and external finance: a survey of UK SMEs

Use of non-bank equity finance or market-based debt was very limited. * Businesses reported financial constraints (high borrowing costs and strict collateral requirements) and economic uncertainty as the key reasons for underinvestment. 1: [...]labour productivity is the quantity of goods and servic...

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Bibliographic Details
Published in:Bank of England. Quarterly Bulletin 2024-01, p.1-22
Main Authors: Bora, Neha, Cottell, Maddie, Karmakar, Sudipto, King, Benjamin, Nyamushonongora, Kim, Sengul, Serdar
Format: Article
Language:English
Subjects:
Collaboration
Collateral
Companies
Economic crisis
Employment
Equity
Finance
Labor productivity
Perceptions
Polls & surveys
Private sector
Product development
Productivity
R&D
Research & development
Small & medium sized enterprises-SME
Uncertainty
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Summary:Use of non-bank equity finance or market-based debt was very limited. * Businesses reported financial constraints (high borrowing costs and strict collateral requirements) and economic uncertainty as the key reasons for underinvestment. 1: [...]labour productivity is the quantity of goods and services produced per unit of labour input (eg, per hour worked). Since the onset of the 2007-08 financial crisis, labour productivity growth in the United Kingdom has been weak. SMEs account for 60% of the total employment and 50% of the turnover of the UK private sector. Nearly 30% of businesses reported investing in new product development and R&D. The survey found that of the businesses that invested in the preceding three years, around 60% invested in IT, and around 50% invested in new plant and machinery and staff training.
ISSN:0005-5166
2399-4568