Improving the productivity of UK small businesses is “one of the biggest challenges” for policymakers, according to a report by the All Party Parliamentary Small Business Group.
The report highlights 7 key steps to boosting economic productivity among small businesses. Since the financial crisis, the UK’s productivity has fallen behind other developed countries such as France and Germany.
7 steps to improve small business productivity
- Provide incentives for investors: Simplifying the tax system and improving liquidity for businesses will encourage more investment.
- Improve access to broadband: Better access to new technologies will enhance the competitiveness of businesses in the global marketplace.
- Support local economies: Targeted investment and reformed Local Enterprise Partnerships will provide a boost to local businesses.
- Reward innovation: Access to R&D tax credits should be improved and equity investment needs more promotion.
- Solve the skills shortage: Government should work with business to increase the number of apprenticeship opportunities, and forge long-term relationships with universities and further education institutions.
- Improve access to public contracts: Small businesses should be more involved in bidding for public sector contracts.
- Boost exports: More support should be given to UK Trade and Investment while the British Business Bank should widen their scope to provide finance to exporting firms.
Annemarie Morris MP, chair of the All Party Parliamentary Small Business Group, said:
“We have a lot of catching up to do in order to keep pace with other leading economies. This report has identified a number of practical recommendations that could be taken up by the next Government. Solving the UK productivity puzzle is critical to helping employers increase wages and boosting the long-term wealth and prosperity of the nation.”