Not so Happy New Year: UK managers’ optimism lowest for four years
Controlling costs and restructuring are among the highest priorities for UK managers during 2018
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 continues to fall.
That’s the headline findings of the latest Future Forecast from CMI, which surveyed more than 1,000 managers from across the private, public and charity sectors on their outlook for the year ahead.
The full report makes for some very worrying reading for UK managers, with optimism for the year ahead falling to just 57% – the lowest level for four years. Almost one in four (23%) managers are gripped by pessimism when thinking about 2018, and a further one in five (20%) feel ‘ambivalent’ about their organisation’s prospects for the coming year.
CMI director of strategy and external affairs Petra Wilton said: “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.
“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.”
The Future Forecast survey also revealed 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 their organisation is a priority for only 39% of those surveyed, 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 – troubling given the changes ahead as Brexit negotiations continue.
Recruitment Trouble Ahead
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 as a result of leaving the European Union.
This is in spite of more than three-quarters (78%) of managers struggling with recruiting skilled new talent; this jumps to more than eight in 10 (82%) who report difficulty hiring new leaders.
Wilton added: “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%.”