UK business chiefs' economic optimism on the rise

There has been a dramatic rise over the past year in the number of senior executives at the UK's largest companies who are now optimistic over future economic prospects for their businesses and the country as a whole.

Financial buildings and institutions in London illustrate an article about UK interest rates
According to this year's 'Captains of Industry' survey, 81 per cent of the business leaders expected their companies' fortunes to improve over the next 12 months - up from 42 per cent a year ago and equal to the optimism expressed when the question was first asked in the survey in 1987.
The report was compiled by research and polling firm Ipsos MORI, which surveyed business leaders from some of the nation's biggest firms by turnover, and financial companies by capital employed.Almost four-fifths of the respondents also expected the economic condition of the country to improve over the coming 12 months, compared to just 30 per cent in the 2020 survey.Kelly Beaver, chief executive at Ipsos MORI, Kelly Beaver said: "This is the 40th anniversary of the 'Captains of Industry' study providing unique insights into what the UK’s leading business people think about a whole host of important issues, across the economy, politics, business, diversity and the environment."What the latest study shows is that while Covid has had a significant impact, businesses are relatively optimistic about the next 12 months."And while it has often been the case across the 40 years of the 'Captains of Industry' study that those interviewed are more optimistic about their own businesses fortunes over the next 12 months than about the general economic outlook, this year bucks the trend with equal optimism across both."
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The survey also quizzed executives on how they saw the future of work shaping up in the wake of the switch to flexible working because of the pandemic. Seven in ten said they expected a majority of their UK workforce staff still to be splitting their duties evenly between an office and their homes in two to three years from now.This compared to the responses to a similar question in 2019 when 93 per cent of respondents said work was carried out mostly or entirely in an office or workplace.The report added: "When considering the new way of working, split between office and home, improved employee wellbeing/work-life balance is considered a key benefit by 73 per cent of those surveyed, while 63 per cent say reduced travel/commuting time is a key bonus."On the other hand, key challenges, according to Captains, include ensuring effective collaboration across and within teams (66 per cent) and maintaining organisational culture/identity (59 per cent)."The survey also found that the Covid-19 remained a major concern of 78 per cent of respondents over future economic prospects for the country as a whole, while half were also worried about the business consequences of Brexit."However," Ipsos MORI added, "economic uncertainty and maintaining and retaining staff are the top concerns for Captains when thinking of their own businesses."Half named economic uncertainty as a key problem facing their company; while a third worry about maintaining and retaining staff. Similarly, 35 per cent named the impact of coronavirus as a top concern.Almost two-thirds of executives agreed with he statement: 'In the long term, this government’s policies will improve the state of the British economy'. Only 21 per cent disagreed, while 41 per cent said they had confidence in the government’s post-Covid economic recovery strategy, while just over a quarter did not.On Brexit, three-quarters of those surveyed feared the loss of trade with the EU would be greater than gains from new trade deals, while only 15 per cent expected them to be equal and seven per cent believed new trade would outweigh losses from the EU.

Read more news and views from David Sapsted

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