New research from the University of Salford has highlighted more than half (57%) of microbusinesses in the Greater Manchester region are struggling to adopt new technologies due to time constraints, while 43% face barriers accessing adequate training, which could be hindering UK productivity during a time of economic uncertainty.
Microbusinesses, with less than ten employees, make up 95% of all businesses in the UK, contributing significantly to economic growth, employment and innovation, and while almost half of the 269 Greater Manchester microbusinesses surveyed reported a positive impact on productivity due to technology adoption, many faced considerable barriers to accelerate this further.
According to government data, UK productivity is around 19% below the US with the UK experiencing a trend of continued ‘sluggish productivity growth.’ To add to this, the University’s research also uncovered 89% of micro-businesses had concerns around cost of adopting new technologies and over a third (35%) expressed a lack of insufficient advice as a barrier to implementation. This is despite half (49%) confirming, when adopted, digital technology significantly enhanced productivity.
Professor Mandy Parkinson, Professor of Business Innovation at the University of Salford’s Business School, comments: “Microbusinesses make up the vast majority of UK businesses and are a huge driver in the country’s economic growth and stability. However, digital transformation is critical for peak productivity and efficiency, and many continue to face barriers to technology adoption which could be impacting long-term success.
“Half of our respondents confirmed the considerable positive impact adopting new technology had on their business, underscoring the transformative potential of digital tools in modern business operations.”
Of the prominent new technologies adopted amongst the microbusinesses surveyed, the most commonly implemented were accountancy software (73%), cybersecurity tools (67%), and project management tools (66%), which were vital for streamlining processes, ensuring data security and enhancing efficiency.
“The pandemic accelerated the adoption of new technology due to the shift to remote working, as well as evolving ways of working in the years following. However, as technological advancements continue to move at rapid pace, it’s essential momentum continues beyond just during times of crisis, if we’re to enhance our productivity growth,” continued Mandy.
To add to the challenging landscape, a recent McKinsey Global Institute survey revealed 87% of companies worldwide report experiencing skill gaps now or that they’re expecting to within the next five years, impacting productivity and competitiveness at corporate and national levels.
Mandy concluded: “It’s clear many microbusiness leaders are keen to drive the digital transformation of their organisation. However, the barriers they face are incredibly challenging to overcome. This, combined with skills shortages, is making it near impossible for businesses to move forward when it comes to effectively adopting new technologies for long-term success.
“As microbusinesses continue to navigate an increasingly challenging climate, support from policymakers, improving access to government grants, enhancing training and support, as well as tailored interventions will be crucial in sustaining their growth and innovation.”
For more updates from the University of Salford, visit: www.salford.ac.uk/news.