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UK SMEs Losing £1,268 Per Second in Lost Productivity

Recent data from Sage’s second annual productivity tracker reveals that UK SMEs have cost themselves £1,268 per second in lost productivity this year. This amounts to over 16 days of lost time so far due to administrative tasks.

Key industry figures, including Ed Vaizey MP, co-chaired an event discussing the challenges affecting business efficiency today. The overall trend shows a decline in productivity, with £40bn of lost economic value in the UK over the past year, an increase of 0.9% compared to the previous year.

Sabby Gill, Sage MD for the UK and Ireland, emphasized the importance of closing the gap in technology adoption among small businesses. Currently, less than a third of small businesses in the UK use cloud technology for administrative tasks, compared to half of large businesses.

The economy has grown by 3.3% in the past year, while productivity has only increased by less than 1%. Gill highlighted the potential impact of automating administrative activities on overall economic growth.

Productivity Challenges

During the event, several issues affecting small business owners were discussed:

Regulatory Burden

Research from the Federation of Small Businesses (FSB) indicates that entrepreneurs spend 178 hours per week complying with tax regulations, equivalent to three working weeks per year. Sonali Parekh, head of policy at FSB, highlighted the challenges of keeping up with tax regulations and the administrative burden they impose.

Finding the Right Tech

Vinous Ali, associate director for policy at techUK, emphasized the importance of understanding the purpose of technology in solving specific business problems.

Adopting Tech

Jonathan Brenton, head of international trade at the Confederation of British Industry (CBI), noted the low adoption of technology in the UK, especially in rural communities. Improving access to technology, such as broadband, could enhance productivity in these regions.

Helping Larger Businesses

Gaynor Bailey, head of HR programme and operations at Channel 4, discussed the challenges faced by larger businesses in processing payments and the potential benefits of outsourcing certain tasks.

In a statement to SmallBusiness.co.uk, Ed Vaizey MP highlighted the role of technology in improving productivity and the importance of networking with other businesses for insights and solutions.

“Technology is the main way of improving productivity. Spending time thinking it through pays dividends down the road.”

He emphasized the value of human contact and learning from others to drive innovation and efficiency in business.

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