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SMEs are facing 'stagflation', survey warns
Enginuity said nearly 80% of UK SMEs plan to raise prices as labour and raw material costs climb and two-thirds remain below full capacity.
Nearly 80% of Small and Medium Enterprises plan to increase prices to offset rising labor and raw material costs, a survey of more than 200 companies across manufacturing and engineering sectors reveals.
Ann Watson MBE, CEO of Enginuity, warns that skills-related challenges cost engineering and manufacturing sectors around £5.2 billion in lost revenue annually, restricting SMEs from achieving full potential.
Financial constraints restrict many SMEs from operating at full capacity for the second consecutive year, while less than 40% of respondents report confidence in the next five years.
Only 10% of SMEs believe new apprenticeship units will address skills gaps, revealing a disconnect between government support initiatives and business understanding despite skills rising on the political agenda.
The Chancellor faces budget pressure to ensure SMEs can afford extra personnel as the Milburn Commission prepares recommendations on extending work experience and skills training to 14 to 16-year-olds.