UK managers deliver gloomy outlook for 2018, as Brexit dampens expectations of growth in economy
- Only 28% of managers expect the economy to grow in 2018, down from 41% before the EU referendum
- 62% of managers saw no growth or decline in their organisation during the past 12 months
- Three-quarters (75%) of businesses will focus on controlling costs over investing in growth in 2018
- Recruitment woes leave 78% struggling to hire skilled new workers
- The Chartered Management Institute calls on employers to continue to invest in workforce to maintain momentum in uncertain times
UK managers are expecting a tough 2018, as the continued uncertainty surrounding Brexit knocks confidence in the workplace and expectations of economic growth for the year ahead falls to 28%, according to the latest annual Future Forecast research from the Chartered Management Institute (CMI).
CMI, the only chartered professional body for leadership and management, surveyed more than 1,000 managers from across the private, public and charity sectors on their outlook for 2018. The results reveal that optimism for the year ahead is at the lowest level for four years – optimism has steadily fallen from 63% in 2014 to 57% today – as pessimism grips almost one in four (23%) managers and a further one in five (20%) feel ‘ambivalent’ about their organisation’s prospects in 2018. Overall, one in four (26%) of the managers surveyed report a declined sense of job security following the Brexit referendum.
The forecast follows a challenging year, with almost two-thirds (62%) of managers report no growth or decline in their organisation in 2017.
Turning to plans for the year ahead, the Future Forecast survey reveals that businesses are set to become more inward looking in 2018. Nearly two-thirds (62%) of businesses will undergo a restructure in the year ahead, as 75% of managers name controlling costs as their main priority, with driving productivity important to 62% of managers. In contrast, investing to grow the organisation is a priority for only 39%, and less than a quarter (23%) of managers say expanding into international markets is high on their agenda.
In an indication of the challenges ahead, 42% of UK managers say they doubt the ability of senior management to manage change. With ‘developing people’ named as a high priority for only half (52%) of those surveyed, and less than one in five (19%) of managers saying harnessing the Apprenticeship Levy will be a priority, workforces are set to become increasingly stretched at a time when access to fresh talent becomes more restricted. This is in spite of more than three-quarters (78%) of managers struggling with recruiting skilled new talent – jumping to eight in 10 (82%) who report difficulty hiring new leaders.
Source: CMI Research December 2017
|Investing to grow the organisation
|Investing in research and product development
|Expanding into international markets
|Harnessing the Apprenticeship Levy
Petra Wilton, Director of Strategy and External Affairs at the CMI, says:
The decline in managers’ optimism in the UK economy for 2018 is unsurprising given Brexit uncertainties. Managers are battening down the hatches, prioritising controlling costs over investing in development - particularly in their staff. But this short-termism feeds a vicious downward cycle. We need to rebuild confidence and nurture growth through investing in people.
Now more than ever great leadership and management is needed to lift the nation out of the productivity rut. According to CMI research, a highly-skilled manager can add nearly £400,000 of value to their employer, with leadership and management development boosting company performance by 23%.
Employers can break the downward cycle by investing in the next generation of leaders. Harnessing the Apprenticeship Levy and getting involved with the National Retraining Scheme will help school leavers, graduates and workers alike develop the world-class skills we need to make us a global powerhouse.
For more information visit http://www.managers.org.uk/futureforecast or follow @cmi_managers #FutureForecast
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