The annual Sage Business Index surveys close to 14,000 small and medium sized businesses in 18 countries around the world.
For the first time in four years businesses around the world are also more optimistic than pessimistic, with scores rising above 50 across all three areas surveyed: their own prospects; their national economies; and the global economy.
Businesses in the UK are more optimistic about the prospects for their own business rising 3.74 points to a four-year high of 66.29. Similarly, businesses have greater confidence in the national economy following a 7.81 increase to 61.76 in the last year, putting them 4.44 points ahead of German businesses and 26.69 points ahead of those in France.Confidence in the global economy is also the highest it has been in four years, after rising 5.15 points to 55.90, 4.22 points above the global average.
In Europe, countries are split over the prospects for the European economy. Businesses in Ireland and Spain are most confident, scoring 56.40 and 54.14 respectively, while the UK, Germany and Poland are all more optimistic than pessimistic.
However, in Austria, Switzerland and Portugal the reverse is true, with all countries scoring below 50. France is the most pessimistic about the European economy of all nations surveyed, scoring just 44.08.
Predictions for growth
The rise in confidence is reflected in businesses’ predictions for the year ahead. Nearly two-thirds (63%) expect their turnover to grow in the next year by 3.5% on average. Almost half of businesses (47%) anticipate that the number of people their company employs will also increase by an average of 1.9, compared with just 6% who believe it will decrease.
Attitudes to risk
The rise in confidence has also resulted in a shift in business attitudes. Nearly half of business decision makers (44%) describe themselves as risk seekers, up 2% from last year. However, the UK still ranks as one of the more risk averse countries, trailing risk seekers in the US (54%) and Brazil (61%).
Among the most confident were those who also do business outside of their domestic market. Two fifths (40%) of those surveyed currently do business in countries outside their own, accounting for 20% of their turnover.
Indeed, the last year has been a good one for exporters with 39% seeing an increase in their level of exports and just 10% seeing a decrease. Furthermore, 50% predict that turnover generated by exports will increase by an average of 3.4% next year.
In spite of this, few UK businesses feel they receive enough help with exports from the UK Government. Only 8% feel they receive the support they need to help grow their exports, with 28% saying the government should offer greater financial incentives and 22% say it should champion businesses and raise awareness abroad.
Brendan Flattery, CEO of Sage UK and Ireland, said: “With the UK economy continuing to go from strength to strength, businesses have been in a buoyant mood in the last 12 months.
"Nearly two thirds of businesses in the UK expect to see their business grow in the next year. That shows they’re feeling very self-assured, as the UK economy charges ahead of the rest of Europe.
“It is fair to say we are in a golden age for entrepreneurs. The research suggests most businesses in the UK, regardless of size, have growth firmly on their agenda. But, as only 8 per cent of UK firms say they receive the support they need to help grow their exports, it’s vitally important that support is there for the UK economy to continue to grow.”
Image: Håkan Dahlström