Thirteen per cent of companies say Brexit-related skills shortages curtailing growth

23 Aug 2018 | 3 min read

The Quoted Companies Alliance (QCA) has found that 13% of 111 small & mid-sized quoted companies it surveyed report that their growth is being curtailed as a direct result of skills shortages relating to Brexit. The latest wave of the QCA/YouGov Small & Mid-Cap Sentiment Index also finds reveals that, while optimism about the UK economy remains muted, many companies remain bullish about their own prospects and capacity for being able to ride out—or even benefit from—disruption that may arise from Brexit.

QCA and YouGov surveyed 111 small & mid-sized quoted companies and 42 advisory firms over June & July 2018. Findings include:

• many companies are indifferent to Brexit risks because they are either wholly domestic-focused or deal mostly with non-EU international customers and suppliers

• job growth expectations are also high for small to mid-sized quoted companies—77% expect to increase the number of full-time employees in the next 12 months and average job growth is 8.5%—the highest recorded since the survey began in 2011

• 39% say they plan to raise capital in the next 12 months.

• raising capital through public equity is the preferred option for small & mid-sized companies with 62% of respondents saying this—the highest this figure has been in the seven year history of this survey (bank finance is the second most preferred option at 31%)

• around a quarter of small and mid-size quoted companies report that attracting (25%) and retaining (23%) EU nationals for roles has become harder since the 2016 EU referendum

• companies report that non-UK EU nationals are deterred from taking or remaining in jobs in the UK

• small and mid-cap leaders report that workers from continental Europe lack certainty about their future status and feel that the UK is now a less-welcoming place

• the decline of the pound has also reportedly made working in the UK less attractive

• changes in the AIM rules mean AIM companies have to follow a corporate governance code for the first time and, in 2018, updated versions of the QCA Corporate Governance Code (QCA Code) and FRC’s UK Corporate Governance Code (UKCG Code) have been released

• companies on the Main Market of the London Stock Exchange have no choice but to apply the UKCG Code, but companies on AIM are free to choose which recognised code they want to adopt—of the companies surveyed, 62% said they apply the QCA Code and 20% the UKCG Code, with 14% still deciding which code to apply

Source: Report: More than one in 10 small & mid-caps’ growth curtailed by skills shortages relating to Brexit

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