The UK government is set to invest £900m in an exascale computer as part of its national artificial intelligence strategy.

Capable of carrying out more than one billion billion simple calculations a second, it would be used to train complex AI models so the UK can build its very own BritGPT.

The urgency of constructing a homegrown GPT is characteristic of an intensifying technological ‘arms’ race, where countries are competing to lead the AI revolution.

However, as the UK gets caught up in the politics of regulation and innovation, SMEs are increasingly being cast aside.

The dependence problem

BritGPt is, in principle, designed to maximise the country’s potential in AI and to give tools to researchers to better understand new drugs and climate change. However, there is also an existing political undercurrent.

According to Haydn Belfield, author of ‘ ‘Great British Cloud and BritGPT’ ’, our progress is dependent on a vulnerable and expensive AI supply chain that encompasses chip designers, data centres and AI developers in Silicon Valley.

Foundation models are expensive to train. Based on Belfield’s research, anything from £10 to £100 million just in computer costs with the potential to increase to the £1 to £10 billion range.

As a result, there’s been a near monopolisation of the provision of foundation models. The ‘Big Three’ AI cloud providers are all based in the US – Amazon Web services, Microsoft Azure, and Google Cloud.

Whilst the US is a strategic ally, logistically, problems could still arise. For instance, undersea cables could be damaged, prices could hike, or there simply could be a lack of oversight and control.

Although building cloud capacity that is comparable with the Big Three is not an overnight task, the UK can do two things to keep itself competitive.

Firstly, it can build up publicly owned cloud capacity that breaks a potential dependency cycle with the US. Secondly, and most importantly for SMEs, it can play to its key strengths in chip design, foundational model training and fine-tuning.

The role of SMEs in the UK’s AI Revolution

The AI business population in the UK is overwhelmingly comprised of startups or small businesses. Of the 3,710 UK companies that are currently registered in the country, 28% were small businesses and 60% were micro businesses.

The problem? 71% of all AI revenue (£7.6bn) was generated by large firms despite just making up 4% of the AI business population. On the other hand, SMEs companies together account for just over a quarter (£2.8bn) of AI revenue.

The skewed contribution between SMEs and big tech is indicative of how disparately capital is being allocated. Worryingly, it shows the risk aversion that continues to handicap SMEs seeking venture capital investment in the UK.

As a result, AI SMEs are being forced to look across the Atlantic for funding. However, rather than a recent problem, this is becoming an ongoing trend for startups in the country.

Autonomy, DeepMind, SwiftKey, and VocalIQ are all British AI and machine learning startups bought by US tech giants like Google and Microsoft.

The technologies these SMEs developed displayed potential to be market leaders. However, to grow, they required high levels of investment that the UK market was simply not offering. In the case of DeepMind, whilst Google acquired the company, a a team remained in London.

In other words, the UK has no shortage of AI talent. Some of the best universities of the world are based in Britain and it has one of the most vibrant environments for startups.

However, to avoid this potential brain drain, the UK needs to play to its strategic advantages in AI and give the right support to its startups that are helping drive the artificial intelligence revolution.

Whilst BritGPT is a step in the right direction to be technologically competitive in AI against giants like China or the US, the rollout needs to be more nuanced.

Otherwise, the UK risks falling victim to the growing monopolisation of funding and resources for big tech companies whilst startups struggle to find finance on home turf.

Nourished, a 2023 Startups 100 Index alumni, won the King’s Award for Enterprise in the Innovation category by recommendation of the Prime Minister to King Charles III.

The award, now in its 57th year, is one of the most prestigious accolades a business can be given in the UK and celebrates businesses that champion international trade, innovation, sustainable development, and opportunities for social mobility.

Launched in 2019, Nourished uses 3D printing technology to produce personalised health supplements in the form of stacked gummies.

Capitalising on the health and wellbeing boom after the pandemic, CEO Melissa Snover found an innovative solution to compartmentalising all supplement requirements into one stacked gummy. Our Startups100 judges thought Nourished was filling a gap in the market and playing into the personalisation trend.

The technology makes use of science-backed nutrients and an intelligent logic recommendation algorithm to make taking daily supplements a quick and easy task.

In conversation with Startups, Snover said, “Innovation is at the heart of everything we do at Nourished.”

“We produce everything in-house from designing and creating our own manufacturing machinery to testing and developing our own product formulations and flavours. It is this unique approach which I believe was recognised in our King’s Award application and which ultimately gave us the honour of winning”.

A track record of success

The King’s Award is just another link in a chain of successes for Nourished. Back in 2019, the Birmingham-based startup secured £1.95m in the highest seed round ever raised by a female founder.

Nourished now employs more than 100 people across three sites in its birth city and is set to hit over £10m revenue in just its third full year of trading.

Previously, the health-gummy business has also placed in the 15th position in the 2020 Startups 100 Index. It also won the Growth Business of the Year at the Business Champions Award and the Elite Business’ Start Up of the Year award.

When asked why it’s important to apply for business awards, Nourished noted “It serves as a validation for your expertise, helping you to establish credibility within your industry.”

“Winning awards creates a sense of pride within your workforce, and encourages loyalty as they feel their efforts are valued and recognised by external entities.”

Ranking on the Startups 100 Index has also given Nourished added credibility. As they note in conversation with Startups, “We have received significant recognition in the press and social media as a result of coming 15th in the Startups 100 Index, which helps to build our brand awareness.”

Nourishing the future

The startup has already expanded into the US and has ambitious plans for the future. Snover told Startups, “We are currently preparing to launch a new product range in the UK, as well as expand into new markets in the EU this summer.”

It also recently took on a £2.5m investment from Suntory Holdings in a strategic partnership to support planned expansion into Asia in Q3.

Nourished’s success and momentum therefore continues to show what our Startups 100 Index alumni are capable of, as well as the importance of promoting innovation, growth, and funding for SMEs in the UK.

80% of people say they’re not concerned that artificial intelligence will replace them at work, according to a survey.

The survey conducted by ID Crypt Global, which sampled answers from 1,196 UK workers, found that 94% of respondents are doing nothing to prepare for the possibility of AI replacing them in the workplace.

Despite the perception that AI doesn’t pose a risk to their jobs, opinion is divided aboutAI’s overall effect on society. 47% said they think it will be harmful, 36% thought it would be beneficial, and 17% remain unsure.

That said, if the time comes when AI is the top candidate for their jobs, 52% believe that their employer and the government share responsibility for re-training them to take on new jobs that are undisrupted by AI.

A minority (14%), however, believe it should be an individual’s responsibility to ensure they are future-proofing their career against a potential overtake by AI.

Is AI a danger to jobs?

These findings follow Goldman Sach’s landmark AI report which predicts that AI could replace the equivalent of 300 million full-time jobs.

In fact, this has already started to happen. IBM announced that it would freeze hiring for jobs that AI can do, with CEO Arvind Krishna saying he believes 30% of his staff will be replaced by AI in the next five years.

So why is there such a mismatch between what employers and employees predict? On the one hand, it might be because of a misperception over how quickly roles are being fulfilled by automation tools.

According to research released in November 2022 by sociology professor Eric Dahlin at Brigham Young University in the US, “Those who hadn’t lost jobs [to robots] overestimated by about double, and those who had lost jobs overestimated by about three times.”

However, it’s not just a matter of the speed at which automation is overtaking humans. There is also the belief that the choice is binary.

But combining artificial intelligence with a human role is possible and in many cases preferable. Several sectors are already evolving with artificial intelligence used as a tool rather than an employee, because they still require exclusively human skills such as creativity, emotional intelligence and judgement.

Should we start future-proofing our jobs?

Whilst many don’t think AI will take over their 9 to 5, employers would be naive to not face up to the expected rise in demand for AI-related skills.

According to research by Salesforce, only one in ten global workers have in-demand AI skills. It’s estimated that the digital skills gap is costing the UK economy a whopping £12.8bn which means employers will be looking for people who can fulfil these future-forward roles.
Nine in 10 businesses believe they should prioritise digital skills for their employees, however, 58% of knowledge workers have never received digital upskilling from their employer.

The lack of training and mismatch between what employers want and what employees can offer led to 8.5 million vacancies in the first seven months of 2022.

Given the relative lack of training offered in workspaces, it would appear that employees need to start taking matters into their own hands.

Therefore, the answer to the question of whether AI will replace our jobs is more nuanced. It isn’t simply that AI will take over human jobs – it’s that people who are prepared for the AI revolution will be at the top of the hiring list.

The Startups 100 Index is the longest-running new business index in the UK. Since 2008, our authoritative panel of experts has shone a light on 1,500 early-stage startups, including industry-giants like Monzo, Deliveroo, and Reggae Reggae sauce.

Entries are now open for the 2024 index, and we want every entrepreneur to apply so we can make this our most exciting list yet.

But, with so many awards out there, it’s hard to know which rosette will bring value to the entrant, and which will just make money for the organiser. This dilemma means lots of firms avoid applying altogether – missing out on a whole heap of business benefits as a result.

Having worked with startup owners for over twenty years, we know that time is your most valuable resource. If you’re considering entering the Startups 100 this year, you might be wondering: is it a smart decision? Is it really worth the effort?

In short, YES. But don’t just take our word for it! Below, we’ve outlined five reasons why you should apply according to those who made the list last year (besides the fact that it’s entirely free to enter).

1. Build brand exposure

The Startups 100 is a brand accelerator. We don’t just use our platform to draw up a bland list of business names. We actively publicise your business for long after the index has been published to ensure a genuine, tangible uplift in brand awareness.

Each year, our writers dedicate hundreds of hours to publishing a 300-word profile on every single company that makes it into our top 100 list, so we can tell the full story of your incredible accomplishments.

Once live, we promote each listed firm far and wide across our 100,000-strong social media following, in order to catapult your company to small business fame and glory.

And, as if that wasn’t enough, we regularly contact all of our Startups 100 businesses for commentary and quotes on the latest news and topical issues that are affecting the UK startup community and SMEs.

Here’s what previous winners had to say:

“The Startups 100 is well-recognised and respected within the startup community. It takes the time to profile and spotlight the different companies and what they’re doing, which makes it more powerful than just a list.” – Beam

From this year, our overall winner will also benefit from a complete publishing package which will include:

• An exclusive feature published on the Startups.co.uk website
• An interview with Eloise Skinner on the Speaking of Startups podcast
• Up to four published articles relaying company news and updates
• Posts to Startups’ social media pages across LinkedIn, Twitter and Instagram
• Branded assets to celebrate the win on your social media pages and website

2. Attract investor and partner attention

Here’s what previous winners had to say:

“We regularly have business partnerships stemming from the coverage. Usually the email goes along the lines of “I saw you in the Startups 100, congratulations….” – SlothMove

Money is probably the most important ingredient in the recipe for a successful startup. It’s the lifeblood that keeps the company going, pays the salaries, and funds the growth.

The best way to boost cash flow is by capturing the attention of new clients or investors, by impressing them with fantastic results and achievements. And the best way to do that is by getting third-party validation from a credible, reputable source.

The Startups 100 Index is widely regarded as a prestigious recognition for early-stage businesses. Being included on the list can help to raise a company’s profile and attract attention from investors, customers, and potential partners.

Here’s what previous winners had to say:

“Since appearing in the list we’ve had numerous approaches from investors, two new clients whose interest stemmed from seeing us on the list, and a collaboration with one of our fellow Startups-100 listees.” – Essentialise Workplace Wellbeing

3. Boost organisational culture

Having a positive organisational culture is absolutely key in today’s business environment. Being listed in one of the sector’s best-known industry indexes provides a solid foundation.

Featuring in the Startups 100 will help you to stand out from the crowd as a forward-thinking employer. Recruitment will be less of a challenge, as job seekers are increasingly seeking out companies that have a good industry reputation.

Being named one of the most innovative and forward-thinking in the whole of the UK also provides a healthy morale boost, as highlighting your staff’s achievements will ensure they feel engaged and motivated to help the company grow even further.

Here’s what previous winners had to say:

“Inclusion in the list means a lot to us as a small team. It’s a boost for all employees.” – Grubby

4. Track your growth

Lots of business awards prevent companies from applying more than once. Not us.

Your relationship with Startups doesn’t end at launch – in fact, it’s just beginning! Our team genuinely cares about every one of our listees, and we keep track of how they are doing so we can celebrate their wins and champion their successes on our website.

Plenty of companies, including big-name industry hitters like Pasta Evangelists, have appeared twice, or even three times, on our list as they go from strength-to-strength.

And, if you didn’t quite make the list last year, we’ll still let you know when entries re-open. That way, we can see how far you’ve come since we last heard from you.

Here’s what previous winners had to say:

“Our close collaborative approach with care providers is, I believe, one of the major reasons we’ve experienced a 300% increase in demand for our platform. Securing a place on the index three times running provides external recognition of our team’s hard work in achieving that goal.” – Birdie

5. Get free marketing materials

Once a Startups 100 business, always a Startups 100 business. Every company that features in our list can capitalise on the win in their branding strategy for years to come, making it the gift that keeps on giving.

Potential collaborators will recognise you as one of the most exciting new businesses in the UK – whether they’ll be a customer, employee, or even an investor.

We asked our previous winners how they had used the Startups 100 logo in their business branding and marketing. Some of the main materials they mentioned included:

• Social media bios
• Email signatures
• Linked in their website
• Funding applications
• Internal presentations
• Partnership applications
• Tendering for contracts
• Job adverts

Here’s what previous winners had to say:

“The Startups 100 has helped to raise our profile within the event industry, increasing our visibility and exposure to potential customers and investors, and enhancing our credibility. These benefits have resulted in tangible outcomes, including increasing our social media following.” – Vendoir

Apply to the Startups 100 2024

With a panel of expert judges, and a proven track record of finding tomorrow’s industry leaders, the Startups 100 is the ideal way to verify your company as a one-to-watch.

Appearing in our list will boost brand awareness, maximise employee satisfaction, and generate long-term financial wins – all of which will move you closer towards achieving your ultimate business goal.

Best of all? Applicants can get every single one of the above benefits entirely free of charge. 

We’re all about celebrating the top new UK businesses in the UK, not charging them. All the entrepreneurs who apply to the Startups 100 2024 can rest assured that we will never ask for a single, hard-earned penny.

Here’s what previous winners had to say:

“Wild became a truly international business last year. We managed to crack a couple of existing European markets and we’ve had a great start with lots of amazing partnerships like our collaboration with Disney’s The Little Mermaid.

“The Startups 100 helps to substantiate the growth and achievements Wild has had, and helps us market ourselves as a business on the up that is both exciting and good to work with whilst also spreading the brand mission far and wide.”- Wild

Related reading:

• 5 top tips to boost your Startups 100 entry
• Startups 100 Index 2023
• Is it worth applying for business awards?

Amazon has pledged to create 750 apprenticeships within SMEs across England next year, including 300 roles for companies that sell on its store.

As part of an £8m investment, the tech giant will fund 300 of the new roles at small businesses that own an Amazon marketplace business.

The initiative is part of the Amazon Apprenticeship Fund. Amazon has been running its own apprenticeship programme for the past decade. It claims to have successfully onboarded more than 3,000 apprentices in the last five years.

Participants will be given access to various training programmes, including marketing and retail apprenticeship schemes, to help boost productivity and exports.

Apprenticeship initiative is good news for the digital skills gap

Alongside its small business seller community, the Amazon Apprenticeship Fund will invest in apprenticeships for customers of Amazon’s cloud-technology unit, Amazon Web Services (AWS).

AWS customers will be able to train new workers in various IT roles, such as DevOps. Workers using cloud-based software can also be taught cloud computing skills.

The news will be welcomed by technology SMEs. Small employers have struggled to find job-ready tech talent thanks to the expanding digital skills gap; itself aggravated by a record number of people leaving work due to sickness.

In the UK, vacancies in the professional technical and scientific industry have increased by 58% from March 2020, according to Office for National Statistics (ONS) labour market figures. That is the second-largest increase across all UK sectors.

The challenge has caused some businesses to pause growth plans – less than ideal in the current economy. The State of European Tech22 poll, gathered by Atomico, found that as much as a quarter of businesses predicted that retaining talent would be an issue in 2023, up 66% from the year before.

James Campanini, CEO of VeUP, an Amazon web seller, praised the initiative as “a practical programme and substantial investment to help close the UK’s chronic skills gap.”

More employers catch on to the benefits of hiring an apprentice

The latest figures from the ONS show that the number of vacancies in February to April 2023 was 1,083,000 – almost 26% higher than pre-coronavirus levels.

In the era of labour shortages and reduced business savings, companies have been experimenting with alternative talent routes, such as hiring ex-offenders.

Apprenticeships have quickly emerged as the saving grace for companies wanting to hire new staff members without sinking thousands into recruitment. Earlier this year, apprentice provider Multiverse calculated that the work of apprentices has resulted in more than £550m in cost-saving or revenue-generating activities for small UK employers.

Starting an apprenticeship training programme is also becoming more popular amongst young people. With graduate salary expectations now massively outstripping base wage realities, many school leavers are looking to paid employment as an alternative to university.

Campanini added: “Enabling the next generation to access high-quality apprenticeship schemes is critical for social mobility and economic growth. This initiative will open doors for hundreds of school leavers.”

News marred by high-profile tech layoffs

The move is certainly good news for SME owners. However, its timing suggests it is also a PR move for Amazon. Like many tech companies, the ecommerce giant has made several mass layoffs to balance out rising overheads.

While the promise to create 750 apprenticeship roles is welcome, the fact remains that the company has cut 27,000 UK jobs in 2023 alone.

Amazon strikes at the firm’s Coventry depot also hit the headlines in January as employees protested longer working hours. Whistleblowers described warehouse teams being unable to take toilet breaks.

Nonetheless, Amazon sellers can feel comforted by the firm’s impressive legacy of apprenticeship delivery. The company claims that nearly nine in ten of the apprentices it has taken on since 2018 have transitioned into permanent roles.

John Boumphrey, UK Country Manager at Amazon, said: “When we launched in 2021, we made a commitment to support around 250 new apprenticeships through the fund, but we’ve been inspired by the success of the programme to date, and expect to create around three times that number by this time next year.”

For more information and how to apply to the Amazon Apprenticeship Fund, small business owners should email: apprenticeshipfund@amazon.com.

The last few years have seen thousands of UK job seekers switch careers as part of a mass wave of quittings dubbed the ‘Great Resignation’.

Now, new data from Indeed has unveiled the industries with the lowest levels of staff loyalty, as employers continue to grapple with an unprecedented staff turnover rate.

Below, we dig deeper into the findings to analyse the jobs that are proving most attractive to candidates, and what employers can learn from these magnetic sectors.

Research suggests employees value pay and perks over passions

Indeed tracked the numbers of jobseekers on its platform between 1 May 2022 – 30 April 2023 looking at those seeking roles in occupations different or the same from their current or last job on their CV.

The results show that driving jobs are the most popular occupations for people considering a career change.

Below, the graph shows that ‘inclicks’ (job seekers wanting to move into an industry) are higher for drivers than outclicks (those leaving an industry). The top left quadrant of the chart shows the stickiest industries, while the bottom right signals poor staff loyalty.

Source: http://indeed.com/

Workers are also most loyal in the driving sector. In fact, historical Indeed data on staff attrition shows that the driving category has seen one of the biggest increases in inward interest and largest declines in people looking to leave versus pre-pandemic.

Acute driver shortages throughout the UK, particularly for HGV and fuel tanker drivers, grabbed the headlines in 2021 as a result of COVID-19 supply chain woes.

Employers responded by ramping up pay to try and fill roles, and the uplift in wage rates across the sector appears to have played a hand in helping employers hold onto talent.

In the face of growing worker shortages, many employers have offered pay rises to retain talent. Data from the Office of National Statistics (ONS) shows that average weekly earnings by industry increased by 6.6% among employees in December 2022 to February 2023.

Following closely behind the driving sector are the software development and accounting sectors. High-demand also means that both occupations typically offer attractive salaries, as well as numerous benefits and perks.

Low-wage hospitality industry scores poorest for staff loyalty

According to Indeed, the occupations people most want to leave or not join include those in hospitality and tourism, community and social service, retail and customer service.

The hospitality industry has been hit hard by the economic downturn, with restaurants and bars facing a huge upsurge in their gas electricity bills. Owners are struggling to pay their staff competitive wages while contending with the increase in overheads.

In 2022, retail and hospitality workers had the lowest average monthly wage. On average, an employee working in this field earned £422 per week, compared to the cross-sector average of £642.

In this context, it is not surprising that retention is so low in the sector. While people might follow their passion into chef jobs or management roles, the reality of typical hours and pay lead to higher turnover.

ONS data backs up Indeed’s claim. It shows that retail and hospitality firms had the biggest employee loss in 2022. 25.9% of people who moved into a new industry came from this line of work, contributing to a net loss of 2.9%.

Flexible working is another pull-factor for career switchers

It’s not all about the money. Cleaning and sanitation also scored highly in worker loyalty. This could reflect the relatively flexible nature of cleaning work versus alternatives.

The ability to work a flexible work schedule has never been more sought-after amongst applicants. Throngs of UK employers now offer a four-day week. The government has even made it a legal right for staff to request flexible working through the Flexible Working Bill.

Nonetheless, certain industries have found it harder to adapt than others. CIPD research suggests that 46% of UK workers do not currently have flexible working in their current role.

This could also explain why workers are turning away from retail and hospitality. When hiring in-person, customer service roles, SMEs in this sector will find it harder to offer flexible working compared to jobs that can be done online (ie. software development or accounting).

Skilled workers least likely to switch careers

As is to be expected, the research underlines that, the more skilled an employee is, the higher chance they have of sticking to their industry.

Indeed found software development job titles had the lowest number of employees seeking work elsewhere, indicating that tech employers are responding to the digital skills gap by introducing incentives to attract and retain staff.

Specialised drivers are also less likely to look for a different kind of job. Retention is particularly strong for driving jobs requiring specific skills and experience, such as HGV drivers.

Upskilling could therefore hold the answer to retaining staff, and reducing the risk of them switching to a career with a low barrier to entry.

Workers are increasingly prioritising learning and development in their roles. In fact, an IMC report recently found that 86% of employees would remain with their current employer for longer if they offered frequent learning and development (L&D) opportunities.

Great resignation triggers reflections on recruitment

Some learnings from the Indeed data are more obvious than others. That employees want to be paid more, for example, is hardly a new discovery.

However, the research also attests to two emerging employment trends that employers should take notice of if they are to stop staffs’ eyes from wandering up a new career path.

The ‘stickiness’ of skilled workers indicates employers should invest in L&D, while the popularity of remote roles testifies to the power of flexible working as a pull-factor. As demand grows for these kinds of policies, those who do not respond will quickly be overtaken by rivals.

Business owners should then use this information to inform their recruitment strategy, and build a more attractive job advert that will appeal to modern candidates.

Jack Kennedy, UK and Ireland economist at Indeed, says: “The study emphasises the need for employers to understand patterns in career switching interest both to boost attraction of workers from other sectors and hold on to existing employees.

“By offering the right rewards, flexibility, training and support, employers can get the most out of their team, boost talent retention and meet the needs of a dynamic workforce.”

More on this: how to manage high staff turnover

Almost eight in ten employees (78%) would be in favour of a four-day working week, but are unclear what the policy looks like in practice, according to a new survey conducted by Startups.co.uk.

In collaboration with YouGov, we asked a representative sample of 530 employees about their current attitudes to a four-day work week. By examining factors like gender, age, and job role, we were able to quantify workers’ attitudes to adopt a four-day week, including the arguments for and against implementation.

Four-day work weeks have rapidly entered into the mainstream following a successful global trial last year. However, our research shows there remains significant blockers to large-scale rollout. Most notably, there’s a widespread lack of confidence that companies will be able to enact the policy effectively.

Support has been building for a four-day work week since the trial ended last December. Proponents believe it leads to a better work-life balance and reduced stress. But our research shows many employees – even those who back the policy – incorrectly assume these benefits would go hand-in-hand with a pay cut and an increased risk of working overtime.

With seven in ten staff members planning to request the perk this year, employers need to educate themselves on the strengths and weaknesses of a shortened week, and fast, to stay ahead of this trend.

Misunderstandings about four-day work week trigger employee scepticism

Despite the understandable interest in a four-day week among employees, our research highlights a huge degree of miscomprehension about how the policy works.

Concerningly, the majority of respondents to our survey assume that a four-day week means they will be paid less money. Our results found 53% were worried about a potential loss of earnings.

In fact, among our respondents, 33% of those opposing a four-day week said they would take a second job if a four-day week was introduced by their employer. This suggests that misunderstandings about a reduction of income could be a deterrent.

🔎 If your organisation decided to implement a four-day workweek for its employees, what would be your biggest concern or issue?

Employees are somewhat confident they would remain productive during a four-day week, as 30% say they would not have to work any additional hours. However, the remaining 70% of employees believe they will work at least one extra hour per week to compensate for time lost.

70% of employees believe they will work at least one extra hour per week to compensate for ‘lost hours’.

Level of seniority appears to influence opinion on how productivity might be affected by a four-day week. Some 36% of those working at an individual contributor level believe no additional hours would need to be worked to make up for working a four-day week, compared to 17% of company partners or owners.

🔎 If you were on a four-day work week, how many hours do you anticipate working beyond your scheduled hours?

Astonishingly, 48% of directors felt they will have to work 2-4 additional hours – potentially up to half a day’s work – to catch up on the lost day. Even so, respondents at director level are still overwhelmingly pro the four-day work week, with 72% voting in favour of the policy.

That said, the perception of reduced hours as a form of ‘bunking off early’ is putting some workers off.

El Gray, a researcher who is based in London, admits that “if the four-day working week is seen as ‘lazy’, I would be less inclined to choose it. How you are seen to perform in the workplace is incredibly important.”

What’s behind the confusion?

Misuse of the four-day week by early adopters could be to blame for employees’ confusion. Many of the employers introducing a four-day week in 2023, like retail giant Sainsbury’s, wrongly conflate the policy with flexi-time.

In reality, if a company knows how to properly execute a four-day week, a full-time employee will work reduced hours (around 28 hours over four-days). Essentially, they will have a three-day weekend and wages will remain the same.

Media coverage of early four-week adopters has gone some way towards educating employers and senior leaders on the benefits and practicalities of implementing a shortened work week. Autonomy’s six-month-long trial of the perk, in which 61 companies took part last year, appears to have had an impact on employee understanding.

Sales manager, Alex Watt says the results of the trial, “make an even stronger case for a four-day week and makes me want one to be implemented even more.”

Eagerness to adopt a four-day week tempered by employer mistrust

Staff might be overwhelmingly in favour of a four-day week. But, 48% of the employees we spoke to have little to no confidence that their employer could successfully implement a four-day week within their organisation.

48% of the employees we spoke to have little to no confidence that their employer could successfully implement a four-day.

From those who lack this confidence, their top reasons for wanting the benefit were higher job satisfaction (38%) and reduced stress and burnout (41%).

This indicates that, where employees don’t trust the employer to implement a four-day week, they are more likely to currently feel dissatisfied in their roles and experience regular burnout.

Distrustful working atmospheres can create a highly undesirable environment for everyone. These kinds of companies are more likely to display poor employee engagement and a negative organisational culture.

A four-day week might be the key to fixing poor trust amongst employees. Introducing policies which prioritise staff wellbeing is proven to have a positive impact on job satisfaction and employee commitment, as workers feel more valued and appreciated.

Workers from every age group would quit their jobs for a four-day work week – except boomers

With the four-day week gaining momentum amongst workers, the majority (52%) of respondents told us they’d be willing to quit to get it. This statistic should make employers sit up and take notice, particularly in light of increasing staff turnover rates.

Business struggles to access talent have been heightened by today’s fast-moving jobs landscape, as candidates call the shots and demand greater choice over when and where their work is carried out.

Gen Z respondents were most likely to seek out a job with a new company if it would allow them to work a four-day week.

58% of people in this age group said they would actively search for a new role with another employer offering a four-day week, compared to an average of 50% across all other age groups.

Boomers, the oldest generation currently in the workforce, are the most likely to oppose switching careers for a four-day work week.

Almost a third said that a four-day work week was unlikely or very unlikely to persuade them to look for a new role. This is considerably lower than Gen Z (19%), Millennial (15%), and Gen X (19%) respondents.

These findings are reflected in a poll by household money-saving tool Nous.co, which revealed a big generational gap in attitudes towards employee benefits and perks. Some 71% of Gen Zers consider non-salary benefits to be important, compared to 36% of 55-64s.

🔎 How likely are you to actively seek out a job with a company that offers a four-day work week?

Declining appetite for a four-day working week, decreasing the older a person gets, is a strong indication of a change in the tide towards a flexible working model.

The shift is most extreme among 18 to 34-year-olds, who no longer want a traditional nine-to-five job. Gen Z employees, who joined the workforce just in time for the post-COVID era of remote/hybrid working, have been quicker to embrace flexible working than older colleagues.

As evidence, this group was also the least worried about the potential for a four-day week to lead to a reduced structure of working hours, indicating that they are more open to flexible ways of working.

🔎 What would be your main reason to opt-in to a four-day work week?

Gen Z respondents were the most likely to want a four-day work week for financial reasons. Some 26% said they would like a shortened work week as a way to reduce commuting expenses, or to make time for a secondary source of income.

This youngest age bracket was also more than twice as likely to worry about potentially spending more money if a four-day week were to be introduced, compared to Boomers. Earlier this year, we reported that today’s UK graduates expect around £5,000 more than the typical starting salary offered by employers.

Matt Reed is a Gen Z employee who is currently living in London. Reed says he has taken a side gig to supplement his full-time job as a writer due to the current economic difficulties.

“I have found some freelance opportunities outside my regular working hours,” he reports.  “My current wage doesn’t go far for someone living in London so it has helped during those cost of living increases. Most notably, with rising food prices.”

Employees could save on child care – but more women will end up doing it

Hiked childcare costs have been making life a misery for working parents, as a lack of early-years-care provisions sends nursery fees skyrocketing to an average of £105.76 per week in 2022. This is 16% of the median weekly wage for a private sector employee.

The crisis is having the biggest impact on working mothers. AIG’s study of over 3,000 employees found women are nearly three times more likely to have to reduce their hours to look after children – one of the biggest contributors to the gender pay gap.

A four-day work week could take away the pressure some women already feel to have to reduce their hours – in this case, without sacrificing pay.

After improvements to work-life balance, the second most popular option that women gave for choosing to opt into a four-day week revolved around family support. We found that 5% more women than men see the value of a four-day working week to support child/adult care responsibilities. The gap rises to 12% at director level.

Meanwhile, men were 11% more likely to label having more time to support their personal hobbies and interests as their main motivator.

🔎 If a four-day working week were available in your workplace, why would you opt for it? (Men vs. Women).

Holly Boultwood is a content director at a global tech firm. She first worked a compressed four-day week when returning from maternity leave, but then went part-time due to the costs of full-time childcare.

“The decision to reduce my hours from compressed to a four-day week was a challenging one,” Boultwood relates, “as it comes with a salary reduction. But it felt like it was important for work-life balance.”

Our findings suggest that a four-day work week would go some way to redress such scenarios.

Should a four-day week be implemented, parents like Holly, who are balancing childcare costs, may not need to work fewer days or take a salary cut. Instead, they can care for their children on the fifth day.

Non-remote workers want a four-day week, but don’t trust their employer to implement it

Our survey found that fully in-office teams have the lowest amount of confidence that their employer could successfully implement a four-day work week. According to our results, just 25% of in-office workers were confident the policy could be rolled out well, versus 39% of remote or hybrid workers.

One of the main criticisms of the four-day week model is that it will work better for industries where team members are not required to work in-person.

Where a staff member’s presence is required to carry out specific tasks (for example, warehouse operatives or restaurant wait staff) it is more difficult for businesses to accommodate rota gaps.

However, a significant percentage of the group who were strongly or somewhat in favour of a four-day work week also work fully in-office (49%). This suggests that the policy should not be dismissed too easily by employers in non-remote industries.

🔎 What is your current working model, and how in favour are you of a four-day work week? 

Overall, 33% of employees who work within either a hybrid or remote capacity, argue that being offered a four-day working week would enable a better work-life balance.

Of those individuals who have no remote working model, the majority also say that a four-day week would give them more time back. They cite reduced commuting time, and extra time for hobbies as the main motivators.

🔎 What is your current working model, and what would be the main reason for you to opt-in to a four-day work week? 

Some 44% of respondents who are fully-remote also specified that a four-day work week would help them to better balance personal and professional commitments.

Similar to a four-day week, the sudden shift to a work from home model has been praised as a way to measure employee’s performance by their productivity and output, not just time spent in the office.

But, with the lines between work and home life now perhaps irreversibly blurred, our findings suggest that remote-workers are still struggling to switch off.

Findings suggest business confidence is tied to employee trust

The UK economy has taken a battering over the past year, after the Bank of England (BoE) raised interest rates to counter the record-high inflation rate. As a result, business confidence remains negative, as pessimism outweighs optimism amongst senior leaders.

Our findings suggest that UK workers are taking a similar outlook. Low employee confidence in employers to successfully implement a four-day work week might reflect concerns about how companies would handle a big strategy change without risking cash flow.

Startups spoke to one employee at a publishing company, who preferred not to be named. They said they did not think a four-day week was feasible in the current financial climate. “With many costs being cut by companies and roles being reduced, I can’t imagine the desire to pay previously agreed salaries for less working hours.”

However, the results from Autonomy’s four-day week UK trial (involving around 2,900 workers) tell a very different story of the impact on company balance sheets. Post-study, organisations reported revenue increases of 35% on average, compared to the same period last year, indicating that participating firms saw an uplift in productivity and output.

Tellingly, 56 of these businesses chose to continue with the four-day week on a trial basis, while 18 confirmed the strategy would be a permanent change.

How should employers react to the findings?

Any change to employment policy has major repercussions for businesses. We’re not saying employers should begin slapping a four-day week sticker onto job adverts from tomorrow.

Still, it is vital for business owners to stay alert to the changing expectations of their staff members – particularly as organisations grapple with a hiring crisis that has triggered major worker shortages.

According to our results, today’s employees overwhelmingly lack confidence in their employer to implement a four-day week effectively, and worry about sacrificing their own pay or needing to work more hours. The findings also suggest that, where trust is lower in the employer, employee dissatisfaction tends to be higher.

These findings are an impetus for business owners to educate themselves on the benefits of a four-day week, and how it might be used to ease recruitment challenges and boost staff morale.

How to implement a four-day week

Trialling a four-day week is the most common approach taken by business owners in order to fully understand the strengths and weaknesses. Undoubtedly, the policy will not work for every firm. But companies must not underestimate the grip that progressive flexible working policies now have over jobseekers.

You might not move to a four-day week straight away. Nonetheless, a test run could also be a catalyst for organisational change, empowering staff to think about how they might be more productive day-to-day to manage work-life commitments.

Workflow tools including project management software can help with the transition by ensuring that employees stay on top of deadlines and responsibilities. Implementing clear task tracking can reduce the risk of a drop in productivity during the changeover from five to four working days.

We’ll be carrying out the same survey in six months’ time, to bring small businesses an accurate and up-to-date picture of this fast-moving policy, and eliminate confusion around how to implement it successfully.

For more information about the research in this article, please contact hello@startups.co.uk for a full breakdown of our results.

The UK is fourth in the world and second out of the G7 economies, in a new ranking of the impact of entrepreneurs on their overall economy from Shopify.

The results were debuted in the Shopify Entrepreneurship Index, a new study that provides data and rankings on 40 countries around the world. It was conducted in partnership with Deloitte using data from entrepreneurs in the Shopify ecosystem and supplemented with data from IMF, OECD, and World Bank. 

According to the index, entrepreneurs in the UK grew their exports by 8% in the last year at a value of over £3.2 billion, supported almost 200,000 UK jobs, generated £28.8 billion worth of business activity in 2022 and contributed £14.3 billion in GDP impact.

What makes our UK SMEs different?

The research from the index also shows that UK small and medium-sized enterprises (SMEs) have been bucking trends seen in other sectors of the economy. 

For one thing, UK businesses were second in export growth only to the USA. This follows data released from Shopify which showed that merchants in London sold the most products globally in 2022 from Black Friday through to Cyber Monday, with one in four (24%) sales for UK merchants being cross-border. This is unusual since these holidays are not primarily celebrated in the UK, but is a testament to the drive of the UK entrepreneurs to use every opportunity at their disposal.

As well as progressive sales and export growth in London, further data suggests that improvements in digital tools and infrastructure have also been helping regional economies across the UK to level up.

60% of entrepreneurs are now based outside of major cities and metropolitan areas – demonstrating that location is no longer a barrier to growth.

The UK’s success may also be attributed, in part, to incentives and support structures to help UK entrepreneurs succeed. Initiatives such as the British Business Banks’ Start Up Loans programme and the UK Government’s recent expansion of investment reliefs have helped some  UK entrepreneurs to attract and retain talent. Investment in British export support, such as through the Export Academy, has also enabled  UK businesses to try out international markets.

However, this support has been in danger recently in general due to the current state of the economy, with banks now reining in SME lending according to a recent Iwoca report, and venture capital slowing down for UK entrepreneurs in general.

More on this: Cost of living statistics small businesses can’t ignore 2023 [Updated]

Maintaining our G7 ranking

Despite the high rating, the impact of local entrepreneurs on the UK’s gross domestic product measurement (GDP), often used by the government of a single country to measure its economic health, saw a 1% reduction from the same time period last year.

There is a danger therefore that the UK could fall behind other nations in our G7 ranking (i.e., our status as one of the world’s most advanced economies) if the UK government continues to neglect and overlook UK entrepreneurship. 

This was highlighted in the lack of consideration for SMEs in the 2023 Spring Budget. 

In order to mitigate this, revisiting incentives for UK SMEs to digitalise is considered essential for the UK to compete. The digitalisation of UK exports, particularly through the Government’s Electronic Trade Documents Bill, could also help UK SMEs cut through friction to export to the rest of the world. 

Deann Evans, Director of EMEA Expansion comments: “It’s great to see the UK ranking fourth overall in spite of the challenging economic climate we’re in. However, as other nations bolster their support ecosystems, provisions need to be made if the UK is going to maintain its status as a leader amongst the G7 economies.” 

“The Shopify Entrepreneurship Index will serve as a barometer on the state of global entrepreneurship from the Shopify ecosystem,” continued Evans. “Providing policymakers with the insight they need to inform their decisions on how best to support entrepreneurial growth.”

Evans also lent her expertise in the ecommerce space to help judge the 2023 Startups 100 ecommerce awards. The 2024 index is now open for applications and is an excellent opportunity for you to showcase and celebrate your business to new audiences. See who made the grade last year here. 

For more information on how to apply, check out our top 5 tips to boost your Startup’s 100 entry. Alternatively, head here to apply now.

Interested in learning about some famous entrepreneur stories?

See: 10 famous entrepreneurs (and the key business lessons they demonstrate)

According to figures from small business lender iwoca, 77% of brokers said that high street banks are reducing their appetite to fund SMEs. 

• 77% of brokers said that high street banks are reducing their appetite to fund SMEs
• British businesses are increasingly worried about access to funding, with new data showing banks are reducing SME lending
• 40% of brokers have seen an increase in applications for funding being rejected over the last quarter

The retreat of retail banks from SME lending comes as the sector is already under pressure from proposed regulatory changes. 

Fintech expert and HedgeFlows cofounder Neh Thaker is concerned about the findings. He explains: “SMEs make up the vast majority of UK businesses, so giving them access to funding and support to grow is critical for driving the economy forward. If our SMEs thrive, we all benefit, in terms of job creation, skills and GDP.”

The impact on small businesses

Colin Goldstein, Commercial Growth Director at iwoca, explains: “With brokers predicting that the impact of current macroeconomic pressures this year will be worse than the pandemic for small businesses, it’s clear that SMEs across the UK are in need of financial support. And – as our data shows – traditional banks just aren’t offering this.”

On top of this, data shows that over 1m SMEs are on fixed energy contracts, negotiated with providers when prices were at their peak. This means the firms are locked into paying expensive bills despite the drop in energy prices.   

Will small businesses turn to alternative funding?

Alternative lenders may be the key to protecting small businesses from this financial shock. iwoca recently extended its funding line from £125m to £170m with long-term partner Pollen Street Capital. The company will use the additional £45m to provide loans to meet the growing demand for SME financing, having seen a 50% increase in the number of businesses it funded across the UK in 2022.

For more information on SME and startup funding and finance, we have the following resources:

• Applying for a Start Up Loan: What to expect
• Grants for small businesses in 2023 – and how to apply
• This is what you can use as collateral for a business loan
• Top 5 business grants to combat the gender funding gap

Even after narrowly dodging a recession, the UK cost of living crisis continues to escalate.

Small businesses are in a precarious position. Bills and overheads are steeper than ever, and customers’ budgets are tightening. The Federation of Small Businesses noted in their quarterly survey that while the confidence of most SMEs was once again on the up in the UK, there are still tough times ahead, and “dark clouds” are expected on the horizon as costs remain high. 

But – there is still hope. What’s essential is to keep up with the trends that are most relevant to your business and your wider industry. 

In this article, we’ve rounded up the most essential stats regarding the cost of living that small businesses simply can’t afford to ignore. While we won’t sugarcoat the grimmer statistics, we will also reveal some of the surprising positives to be found, so it won’t always feel like all is lost. So, buckle up and get ready to equip yourself with the insights you need to weather this storm.

📈 Interest rate rises rose to 4.25% in March: the highest in 14 years

Developments at the Bank Of England led to a confirmed interest rate increase of 4.25% this past March. By August, the Bank of England predicts the rate is intending to continue the rise to a high of 4.6%, before beginning to decrease over the next five years. Any further updates will be announced by the Bank of England on May 11.

The main consideration for small businesses:

The rise in interest rates will mean higher repayment costs, which may affect your cash flow and ability to invest in new projects. A good business continuity plan will help you to decide which costs are the most important to prioritise in these challenging times.

🗞️ The statutory hourly rate rose by 9.7% from £9.50 to £10.42 for adults aged over 23.

The statutory hourly rate in the UK rose on 1 April, providing millions with a little extra in their bank accounts monthly to tackle the cost of living crisis, according to Gov.uk.

The main consideration for small businesses:

The main consideration here will be considering the impact of this change on your labour costs. If you currently employ workers who are paid the statutory hourly rate, they will need to increase their wages to comply with the new rate and check out the best payroll software for small businesses for how to do it.

🗞️ Mortgage approvals hit 14-year low

According to figures from the Bank of England, the number of mortgages being approved to home buyers fell for the fifth month in a row in January.

The main consideration for small businesses:

It’s best to exercise caution when considering locking into a long mortgage right now, particularly with the high-interest rates we’re currently experiencing. With the ongoing economic uncertainty, it may be wise to wait until rates decrease or stabilise before committing to a long-term mortgage.

🗞️UK private rental prices increased 5.0% in the year to May 2023

This is the largest annual percentage change since this UK series began in January 2016.

The main consideration for small businesses:

As a small business owner, you may need to reassess your operations and evaluate whether it is sustainable to continue renting or if alternative options, such as renegotiating your lease term, is more favourable.

🗞️ 83 million job roles will be eliminated in the next four years

In the UK, 83 million job roles will be eliminated in the next four years and more than a fifth (21%) of all jobs will change in the next four years. Changing tech trends such as AI, plus the green transition, will utterly disrupt labour markets, according to new research by the World Economic Forum. 

The main consideration for small businesses:

As a small business owner, it’s crucial to diversify your skills, especially when there’s a threat of jobs and industries being eliminated. Diversifying your skills can help you stay competitive in the market, adapt to changing trends and consumer preferences, increase your versatility and give you a broader perspective on how to run your business effectively. 

Trying new things can lead to innovation and help you stay ahead of the curve in your industry. It’s essential to be open-minded, proactive, and willing to take calculated risks to succeed. A great place to start might be to learn about personal branding.

🗞️ 185.6 million working days were lost due to sickness or injury during 2022

The Office for National Statistics (ONS) said about 185.6 million working days were lost due to sickness or injury during the year, almost 25% more than 2021 and the highest since records began in 1995. The average worker was off for 5.7 days.

The main consideration for small businesses:

The best thing small businesses can do in this situation is to review their sickness absence policies and consider how they can support employees in maintaining good health and well-being, and have contingency plans in place to manage absences and ensure that workloads are managed effectively. 

📉 Inflation eases to 8.9% in March 2023 overall

Finally some good news – inflation rates dropped in March 2023 overall, according to ONS.

The main consideration for small businesses:

This could potentially mean that we are out of the worst of it if you are the kind who likes to think positively – and if that is the case, it might be a good idea to start thinking about your marketing strategies once again to attract more customers and generate sales. This may involve leveraging social media platforms, creating engaging content, and implementing targeted advertising campaigns in anticipation of the comeback of a more normalised consumer market.

Gas and electricity statistics

📉 Gas prices have currently dropped back to 15-month low and ‘sense of normality’

Fortunately, it is not all bad news on the horizon when it comes to gas prices. There has been some news about gas prices being set to drop back to more ‘normal’ prices in summer, to where it was 15 months ago, before inflation hikes and Russia’s invasion of Ukraine.

📈 Electricity prices up 66.7% in the year to March 2023, and currently remain unchanged

Electricity in the UK rose by 66.7% and the increase in price was one of the worst drivers of the annual inflation rate this year. The prices have also had an indirect effect on the prices of goods and services, as well as the closure of many SMEs, as businesses experienced increased costs that could not all be saved by the Energy Bill Relief Scheme (no longer active) or the dramatically reduced Energy Bill Discount Scheme (EBDS) that replaced it.

The inflation rates for gas and electricity showed stability from April to May, as prices increased by 36.2% and 17.3% respectively in the 12-month period ending in May 2023.

These figures mark a significant decrease from the peak inflation rates of 129.4% for gas and 66.7% for electricity observed during the annual inflation rates between January and March 2023.

📈 Brits pay almost double the European average for energy as cost of living crisis bites

Although the government extended its Energy Price Guarantee for home users until June, bringing the average household energy bill to £2,500 a year, the cost is still eye-watering. Now, new research figures from The Underfloor Heating Store has revealed that Brits pay nearly twice the European average per kilowatt of energy.

The main consideration for small businesses:

In our article “How to budget for energy inflation”, we talk about how to budget for energy costs, and identify the areas where small businesses can reduce spending and improve fuel efficiency.

🗞️ Construction firms represent 18% of all insolvencies in March 2023

With a downturn in new housing projects and consumers tightening their belts on home-related spending, 405 building companies have become insolvent this year so far, and a further 6,000 company insolvencies are expected in 2023.

The main consideration for small businesses:

If you own a construction firm, it’s an essential time to manage your cash flow effectively. Try to keep costs and debt low, and ensure you have sufficient reserves to weather this current economic uncertainty. This may involve re-evaluating your business model, diversifying your services, and reducing unnecessary expenses to maintain profitability.

Working on your website and marketing may help to generate some sales – Wix even has a selection of custom website templates designed specifically for the construction industry.

🗞️ 55% of employers struggling to find workers with ‘green’ skills

Over half of business decision makers (55%) are keen to hire new staff who are conscious about climate change, with 57% considering specialised “green” skills as important to their business.

On top of this, 43% are prioritising their company’s sustainability goals, even despite the cost-of-living crisis – with a third seeing this as an opportunity to future-proof their business.

The main consideration for small businesses:

UK small businesses and recruiters can take several steps to embed sustainable practices into their company culture – such as training programmes for their existing staff, collaborations with educational institutions, and/or actively seeking out candidates who have demonstrated a commitment to sustainability – to ensure that they will be well-positioned to thrive in the “green revolution”.

📉 Fuel prices plunge to their cheapest level since Russia’s invasion of Ukraine

As of 16 May 2023, average fuel prices fell to 145p per litre for petrol and 154p for diesel for the first time since Russia’s invasion of Ukraine after reaching record highs last summer, according to Daily Mail.

📉 Motor fuel inflation rates turned negative in March 2023

The price of motor fuel fell by 5.9% in March 2023, according to the latest annual inflation figures from The Office Of National Statistics (ONS). This is the ninth month in a row when transport inflation has fallen from a peak of 15.2% in June 2022, and the lowest rate since November 2020. Automotive fuel sales volumes also rose 0.2%.

The main consideration for small businesses:

While lower fuel prices may provide some relief in terms of cost savings, it is important to remember that inflation rates for other goods and services may still be rising. It’s also unclear how long the trend of falling transport inflation will continue – we’re not out of the woods quite yet. 

Using vehicle tracking systems or fuel cards may be a more viable option than relying on decreases too much in your business. Keep an eye on the economic trends, and be prepared to adjust your pricing and budgeting strategies accordingly in all circumstances.

📈 Rail fares up 5.9% in the year to March 2023

Despite the government price freeze in January and February, rail fares rose once again this year by 5.9% in March, keeping the UK as the frontrunner for most expensive travel costs in Europe.

The main consideration for small businesses:

Small businesses may need to consider alternative modes of transport or find ways to reduce their travel expenses to mitigate the impact of rising rail fares on their profitability. You may also want to consider a four-day working week, or allowing your staff to work from home.

There have been a lot of rapid changes in the retail sector in particular, from general sales falling in March by 0.9% to now picking up again this May. In lieu of all this uncertainty, you may want to check out a few commerce tips on how you can potentially streamline your consumer strategy and feed your consumer’s often fickle appetite.

🗞️ Retail sales volumes rose by 0.3% in May 2023

The month saw a notable 2.7% increase in non-store retail sales volumes, driven by robust sales from online retailers specializing in outdoor-related products and summer clothing.

Retailers have attributed this growth to the favourable weather conditions experienced during the latter half of the month.

The main consideration for small businesses:

Now is a good time to consider leveraging the demand for outdoor-related goods and summer clothing by offering relevant products and promotions

🗞️ 83% of younger retail workers feel they “are being ripped off’ by being paid less than older counterparts

According to Usdaw (the Union of Shop, Distributive and Allied Workers), they found through a survey of 7,500 people that younger workers were in effect being ripped off by being paid as little as £5.28 per hour, which is the national minimum wage for those under 18, for performing the same jobs as older workers.

The main consideration for small businesses:

While it may be tempting to hire a 16-year-old to make a quick saving on labour costs, it is important not to take advantage of their willingness to work for lower pay. The survey findings suggest that younger workers may feel undervalued and ripped off, which leads to low morale and higher staff turnover, and that is bad for any business.

🗞️ Consumer Price Index (CPI) inflation fell to 10.1% in March from 10.4% in February.

The Office for National Statistics (ONS) revealed that Consumer Prices Index (CPI) inflation fell to 10.1% in March from 10.4% in February. The consumer price index measures the overall change in consumer prices based on an average representation of goods and services over time.

The main consideration for small businesses:

Despite the slight decrease in the inflation rate, it’s still eye-wateringly high. Small business owners in the UK need to remain conscious of their customers’ budgets. To retain customers and attract new ones, it would be a good idea to surface deals and savings for them wherever possible, provided these can still be profitable for your business. Such promotions can help to alleviate some of the financial burdens customers may be experiencing, and increase loyalty to your brand.

📈 Inflation rate for food and non-alcoholic beverages rose to 19.2% in March 2023

In the UK, the price of consumer goods and services rose at the fastest rate in four decades in the year to October 2022, and are at a rate now that most big-name supermarkets are coming under investigation for potential ‘profiteering’. For restaurants, cafes and food stalls, rising prices have the potential to deter customers on tight budgets.

The main consideration for small businesses:

As a small UK business owner, it’s more important now than ever to keep a close eye on inflation trends, particularly in the food and beverage sector, to make informed decisions about your pricing and cost control strategies – especially in a way that remains ethical and doesn’t harm the long-term trust of your customers. 

🗞️ New tipping law will put £200 million back into the pockets of hospitality workers each year in 2024

The Employment (Allocation of Tips) Act 2023 received Royal Assent this week and makes it unlawful for businesses to hold back service charges from their employees. 

The main consideration for small businesses:

As a restaurant owner, this should only be seen as an advantage in bringing people back to the industry, as they will now consider things fairer. 

🗞️ Inflation rate for restaurants and cafés eased to 10.4% in March 2023

According to the ONS, the prices of food and non-alcoholic drinks rose at the fastest rate in more than 45 years in the 12 months to March 2023. Cucumbers (up 52%), olive oil (49%) and hard cheese (44%) saw the largest increases. Still, this was a decrease in inflation from the highs of February, which reached 11.4%.

The main consideration for small businesses:

Small businesses may need to consider various strategies to manage these cost increases, such as renegotiating contracts with suppliers, seeking out alternative sources of ingredients, or adjusting menu offerings to reflect changing prices. Food prices will need to be carefully monitored, and strategies will need to be adjusted accordingly to navigate this challenging environment.

🗞️ Around 1 in 4 adults are borrowing more money or using more credit

Nearly a quarter (23%) of adults in Great Britain reported borrowing more money or using more credit in the last month compared with a year ago, according to ONS.

The main consideration for small businesses:

Small business owners should consider offering discounts or incentives to encourage full and timely payments from customers to improve their cash flow forecasts at this time.

You could also use credit methods as a primary strategy to secure deals with wholesalers and manufacturers, to boost inventory rather than using it on random one-off sunk costs and liabilities. If you must borrow money, it’s better to spend it on an asset that provides ROI.

📉 Only £2.9bn has been invested into UK firms this year so far by venture capitalists

A total of £2.9bn was invested into UK firms in the first quarter of this year, marking a sharp fall from the £12.3bn raised last year when low-interest rates were still fuelling a deal boom, according to data from big four firm KPMG. This marks a shocking 123% decrease in venture capital investments.

The main consideration for small businesses:

Despite the general dip in venture capital, there will always be opportunities for innovative businesses to find ways to stand out from the crowd. Our article on Venture Capital: how it works and how to attract it has all the guidance you need to get started.

🗞️ 16% of the workplace are suffering from mental health, costing £14bn

The sluggish British economy loses £43bn a year from the growing “disease burden”, new research from The Telegraph shows, reflecting how overall health across the population is deteriorating. Mental health accounts for around a third of this cost at £14bn. 

Depression rates are in third place, and rising at the fastest pace behind cancer and diabetes.

The main consideration for small businesses:

Now it is more important than ever to try and stay on top of mental health. You should aim to support your team to reduce sick days and maintain morale and good teamwork. If your budget allows, invest in employee benefits that can help ease the burden on stressed staff members, or that offer them support for their physical and mental health.

🗞️ 1 in 5 say they are squirrelling away less than £50 a month

According to a survey by YouGov, one in four people aged 25 to 49 are saving nothing at all and have no nest egg in case of an emergency. Of those who are saving, one in five are saving less than £50 a month.

The main consideration for small businesses:

UK small business owners in the arts or entertainment industries should be conscious of the limited savings and budgets of potential customers at this time. It may be beneficial to focus on providing low-cost or no-cost events to promote your brand and attract customers for the long term. This could include hosting free concerts or events in public spaces or offering discounted tickets for events during off-peak times. By being creative and finding ways to offer value to customers without breaking the bank, you may still be able to increase your customer base and grow your business.

Conclusion: What can small businesses do to survive the cost of living crisis?

During these challenging and trying times, small business owners should prioritise their financial management. 

This might include keeping a tighter track of your expenses, creating a budget, and seeking professional financial advice and services when necessary. That way you can better understand your financial situation and the different options you have available to you – and so that you will be able to make more informed decisions to help your business survive and thrive.

It’s important not to panic and make rash decisions, such as cutting corners on quality or reducing any trust in your workforce. Such moves can have long-term negative consequences. Instead, you should remain calm, focus on your strengths, and seek help and support when needed. 

It would be much more advisable to simply ensure that you’re doing all of the smaller things that will help your business, such as reducing overhead costs, before doing anything drastic. 

For example, be sure that you’ve switched to energy-efficient lighting and equipment; negotiate better deals with suppliers when you can, and try to streamline your processes to reduce waste and improve efficiency.

In conclusion, small businesses can survive the cost of living crisis by managing their finances, cutting overhead costs and keeping a clear head. 

While these measures may require some effort, they will help most small businesses weather the storm and emerge stronger in the long run.

Winning business awards can provide your business with validation and credibility, as well as make you stand out from competitors, and can serve as a powerful marketing tool.

While most agree that awards are a benevolent force when it comes to boosting a company’s reputation and increasing brand awareness, others are sceptical about the real benefits of applying, or their chances of winning – women, and people of colour in particular. 

But with so many SMEs feeling the crunch right now, and the time, resources and effort often needed to prepare and submit an application, many are left wondering: is there actually any point in applying to business awards? 

In this article, we will explore the pros and cons of applying, plus what companies should consider before deciding to pursue them.

🥇 Business awards: the benefits

Applying for a business award can be a great way to showcase your company’s achievements and gain recognition for your hard work. Here are some of the other benefits:

1. Elevating your business to the next level

“The highest reward for a person’s work is not what they get for it, but what they become because of it.” – John Ruskin, writer, art critic, and social thinker.

The Pygmalion effect is a phenomenon in which higher expectations lead to better performance. In the context of business awards, it can be argued that the act of striving to win an award can create a self-fulfilling prophecy of excellence. When a business sets its sights on winning an award, it is essentially raising the bar for itself, and this can lead to greater effort, innovation, and attention to detail.

Businesses that apply for awards are typically required to provide detailed information about their operations, including financial data, marketing strategies, and customer feedback. 

This process of self-reflection and evaluation can help a business identify areas where it can improve and can provide valuable insights into what its stakeholders want and need.

While winning an award is certainly a worthwhile goal in and of itself, the process of striving for that award can be just as valuable in terms of creating a culture of excellence within a business.

2. Boosting customer and client confidence

In the indelible, immortal words of Lady Gaga, “I live for the applause, applause, applause.” 

An award gives a business external validation, credibility, and proves to customers and clients that they are doing something right. Winning an award shows that the company’s products, services, or business practices have been recognised by experts in the industry. This recognition can help to reassure customers and clients that they are making a good choice by working with the company. This validation can be particularly important for small businesses or startups trying to establish themselves in a crowded marketplace.

3. Cheaper marketing opportunities

Winning an award can be a great way to generate free publicity for your brand even if you don’t win. Organisers usually provide shortlisted candidates with marketing materials, press releases and content which can be reused and repurposed free of charge.

4. Brand exposure

Plus, they typically go to great lengths to promote the winners through their small business websites, social media, press releases, and other marketing channels, which can significantly increase your brand’s awareness and reach new audiences that may have never heard of your business before. The exposure that comes with winning an award can attract new customers, partnerships, and investors, giving your business the boost it needs to take it to the next level.

5. Benchmarking

Benchmarking can be a powerful tool for driving business growth and staying competitive in a rapidly changing market – and applying for an award can be an opportunity to compare your company against other successful businesses in your industry. 

The application process often requires a detailed analysis of your business operations, financials, and achievements, which can help identify areas for improvement and best practices. Even if you don’t win, the feedback and insights from the judging process can be valuable in driving business growth.

6. Employee motivation and engagement

Winning a prestigious business award is no small feat, so it’s only natural that it would be a major morale booster for employees. It’s a tangible validation of their hard work, dedication, and contributions towards the success of the organisation. Recognition of this kind makes employees feel valued, appreciated, and motivated to continue performing at their best. 

As a result, the company not only retains its top talent but also improves overall employee performance, leading to greater success and growth. The positive ripple effects of winning a business award can be felt throughout the organisation, from the leadership team to the frontline workers.

7. Attracting top talent

In today’s competitive job market, winning a business award can help attract top talent to your company. It demonstrates that your business is successful, innovative, and recognised for its achievements, which can make your company more appealing to job seekers. This can help overcome the current hiring crisis and enable you to recruit the best candidates.

8. Attracting venture capital and other investment

Winning a business award is not just a recognition of your company’s achievements, but it can also open doors to new and exciting investment opportunities. The award is a powerful validation of your business model, business valuation, growth potential, and track record – providing tangible proof that your company has a solid foundation and is on a path to success. 

Venture capitalists and angel investors are always on the lookout for promising opportunities, and winning an award can increase your visibility and credibility in the eyes of potential investors. This newfound recognition and trust can translate into financial support that can fuel your future growth and expansion plans, propelling your business to even greater heights.

9. Building valuable connections

Applying for a business award can be more than just a chance to win recognition and boost your business’s reputation. It can also open the door to valuable networking opportunities that can propel your company forward. 

Business award ceremonies and events offer a unique opportunity to connect with other successful business leaders and industry experts, providing a platform to share experiences, ideas, and insights. 

By engaging with like-minded entrepreneurs, you can create new collaborations, partnerships, and alliances that can lead to exciting new business ventures and drive growth. Whether it’s through formal business networking events or informal chats over coffee, the connections made through business awards can provide lasting value and help your business succeed in the long run.

🥇 Business awards: the drawbacks

While there are numerous benefits to applying for and winning a business award, it’s important to also consider the potential drawbacks.

Here are some of the challenges and downsides that businesses may face when participating in awards programs:

1. Expensive

Some business awards charge in order for you to apply. While some argue that this is to maintain a high quality of entries, others believe this practice creates barriers for small business owners and reinforces elitist attitudes within the business community.

The requirement to pay a fee to apply for a business award can also create a perception that the awards are designed to reward those who are already successful or well-connected. This can contribute to a sense of bias or unfairness that may discourage small business owners from applying and creating an ultimately skewered list.

2. Time-consuming

Many small business owners wear multiple hats and need to dedicate their time to must-dos rather than nice-to-have activities. Quite often, business awards require extensive documentation and data submission, which can be time-consuming to source and input. Many need a comprehensive organisational profile, performance results, and descriptions of key processes and approaches.

Others, such as the Forbes 30 Under 30, involve a lengthy application process, as well as multiple rounds of submissions and interviews. This can be particularly challenging for small business owners who may have limited resources and time to devote to the process.

3. Low ROI or chance of success

Small business owners may feel that business awards are beyond their reach, given the large number of applicants and the stiff competition they face. 

Many business awards are criticised for intensely specific criteria that eliminate many entrants or are seemingly tailored to a specific type of person or business the establishment specifically wants to win.

Most competitions also tend to only focus on the top spot – giving all the praise and recognition to a single winner in the midst of thousands and thousands of applicants.

4. A perceived (or actual) lack of inclusion

There is a lack of diversity in award applications, which can be attributed to a variety of factors. Many awards programs have a history of overlooking or undervaluing the contributions of women, people of colour, and other marginalised groups – which in turn has caused women and people of colour to be less likely to apply. 

Forbes’ annual list of young entrepreneurs and business leaders is one example of a business award that has been criticised in the past for being too exclusive and for favouring individuals from wealthy and well-connected backgrounds. Critics argue that the list is more about pedigree and connections than actual achievement.

To apply or not to apply: things to consider

When it comes to deciding whether or not to throw your hat in the ring for a business award, there are a few key factors to consider:

Your company’s goals and values: Consider whether the award aligns with your business goals and values. For example, if your company is focused on sustainability, an award that recognises environmentally-friendly businesses may be a good fit. But, if the company hosting the award doesn’t align with your business values, it may not be the best idea to align yourself with them.

Eligibility: Each award has its own set of eligibility criteria that you’ll need to meet in order to be considered. Make sure you read these criteria carefully and ensure that your business meets the requirements, otherwise, your application will likely be rejected on this premise alone.

The process: Ensure that you have the resources and time to put together a strong application before applying, to reduce the likelihood of the process becoming too tedious and time-consuming. Do the benefits of winning the award outweigh the time and resources needed to apply?

The competition: Awards can be highly competitive, with many companies vying for the same recognition. Before applying, think carefully about all the things that make your business stand out and evaluate your chances of winning. If the competition is too fierce, you may want to consider waiting until your business has achieved more significant milestones, or until you’ve completely honed in on your USP and story.

Benefits of winning the award: Consider the benefits of winning the award. Will it provide valuable exposure for your business? Will it help you attract investors or customers? Will it boost employee morale and motivation? If the benefits outweigh the effort required to apply, then it’s worth considering.

Conclusion: Is there any point in applying for business awards?

The simple answer is yes. 

Applying for business awards can bring numerous benefits to your company. It can increase your visibility and credibility in the industry, attract potential investors and customers, boost employee morale, and help you stand out from the competition.

However, it’s important to note that not all awards may be the right fit for your business, so it’s essential to do your research beforehand to ensure that you are applying for the awards that align with your values, goals, and mission.

The Startups 100 index offers numerous benefits worth considering. As one of the most prestigious awards for early-stage startups, it offers a great platform to showcase your business, gain recognition, and connect with like-minded entrepreneurs. Plus, we have tried to make the application process as easy as possible, so you can focus on what matters most: growing your business.

For more information on how to apply, check out our top 5 tips to boost your Startup’s 100 entry. 

Alternatively, head here to apply now.

Good luck!

Young people have plenty of entrepreneurial enthusiasm but have low confidence about their practical business skills, according to a new report by Connectd.

The survey, conducted by independent pollsters Censuswide, explored the attitudes and perspectives of Gen Z founders in contrast to entrepreneurs over the age of 25.

It found that Zoomers are 29% more likely to have doubts about their business knowledge when compared to older entrepreneurs.

According to Gen Z founders, they struggle most with understanding how to commercialise their proposition. 80% of respondents said this was their biggest area for improvement, as they attempt to seat business practicality and scale-up alongside their creative ideas.

Booming entrepreneurial landscape means Gen Z founders struggle to stand out

Gen Z has been labelled the ‘startup generation’ by experts, thanks to their penchant for side hustles. In fact, research has shown that 36% of young people want to be their own boss one day.

The Connectd survey, conducted by independent pollsters Censuswide, explored the motivations and actions of 50 Gen Z founders and compared them with the same number of entrepreneurs over the age of 25.

According to the results, the biggest challenge Gen Zers are currently facing is finding a unique selling point (USP) that will enable them to stand out from the competition.

42% of Gen Z founders felt this was their biggest challenge, compared to 35% of founders aged 25 or older.

Post-COVID, the UK’s entrepreneurial community has welcomed a huge number of new tenants. Government data shows that 753,168 companies were set up between March 2021 and March 2022, only a slight decrease on the year before.

In an increasingly competitive market, crowded with voices shouting about how unique their product or service is, it can take businesses years to figure out how to build a unique brand that can make enough noise to stand out.

Even experienced business owners know the struggle of choosing a business name and registering it on Companies House, only to realise the idea has already been trademarked.

Gen Z founders more likely to use technology to solve business challenges

Nonetheless, it is not just younger founders who feel they are missing out on crucial business knowledge. Entrepreneurs aged over 25 still feel they have much to learn, with 63% citing understanding of technology and products as their biggest area for improvement.

Small businesses began a rapid digital transformation post-COVID, as many firms switched to virtual meetings and online working.

But while new ways of working seem to be difficult for older workers to acclimatise to, Gen Zers – the group who grew up alongside the internet – have quickly adapted and are using the tools to fill their knowledge gaps.

82% of business founders under the age of 25 say they predominantly use technology to find the answers to their business quandaries. That’s compared to 65% of older workers, who are more likely to outsource their business challenges to experts.

Gen Zer’s familiarity with tech means they will also have a natural advantage when it comes to using emerging tools, like AI marketing software, to scale their business.

Founder and CEO of Connectd, Roei Samuel, commented: “Gen Z founders are incredibly adept at identifying their own weaknesses and proactively finding solutions. It’s an exciting time for the entire startup ecosystem to play a part in empowering this next generation.”

Want to start your own business, but need help getting started? Check out our simple, 11-step guide to how to start a business..

The number of people not working in the UK due to illness has risen to a new record, in part triggered by a rise in employee mental health issues.

Labour market figures from the Office for National Statistics (ONS) show that 438,000 more people were not looking for work from January to March 2023 because they were on long-term sick leave. In total, 2.5m people are not currently working due to health problems.

Speaking to the BBC’s Today programme, Darren Morgan, director of economic statistics at the ONS, blamed the uplift on “conditions related to mental health, particularly in the young”.

In a survey of over 1,000 UK employees and HR managers, Reward Gateway, an employee engagement platform, found that four in five workers say workplace burnout has had an impact on their health and wellbeing.

Almost half say that they frequently experience feeling overwhelmed, driven by increasing inflationary pressures.

Gen Z workers most likely to suffer from burnout

The Reward Gateway research reports that Gen Z employees are experiencing burnout in the workplace at the highest rate.

Almost half of 18-24 year olds, many of whom will be in their first roles, are entering the workplace with a higher baseline level of stress than their older colleagues.

In part, this could be due to low employee engagement. Most young workers have entered the workforce during the era of remote and hybrid working. As a result, they are struggling to connect with their coworkers, managers or employers.

For this younger group, who typically live alone, lack of socialising could be worsening the issue. Research from London Heritage Quarter shows that 61% of young people report going for hours without talking to anyone when working from home.

As a result, their mental health is suffering. The same report found that 54% of Gen Z workers admit to feeling lonely and isolated at home, compared to 38% of older colleagues.

Rise in burnout adds fuel to ‘quiet quitting’ fire

Last year, employers were taken aback when workers began ‘quiet quitting’. Quiet quitting refers to staff members who have become disengaged from their job, and put in no more time, effort, or enthusiasm than absolutely necessary.

If a worker’s productivity dips (they leave work early, or they are no longer contributing to projects) they might be quiet quitting.

Despite a general trend amongst job hunters towards meaningful work, where passions are prioritised over payslips, financial pressures are clearly still causing stress for employees.

The social media trend became popular in light of low staff morale caused by the cost of living crisis, which saw real wages fall significantly as a result. The ONS figures show that the squeeze on pay remains, with wage increases between January and March 2023 failing to keep up with rising prices.

As a result, quiet quitting continues to plague bosses. According to Reward Gateway, 24% of UK employees say that they are no longer going ‘above and beyond’ at work.

Low engagement hits productivity

Quiet quitting undoubtedly has a negative impact on organisational culture. If an employees’ colleagues are forced to pick up the slack from their co-workers, they will likely begin to feel overworked and burned out, exacerbating the problem.

There is also a financial impact. Workers choosing to put in less effort could lead to a significant rise in operational costs as the company misses out on growth projections. Labour costs might also surge as business owners hire more staff to increase productivity.

According to Gallup, disengaged employees cost their company the equivalent of 18% of their annual salary due to lost training and recruitment costs, paid sick leave, and productivity losses.

Employers should reward staff to combat poor mental health

The research demonstrates a marked gap in expectations for improvement when it comes to employee health and wellbeing support.

Of those surveyed, a minority of employees rate the physical (32%), mental (39%) and financial (28%) wellbeing support from their employers as ‘good’ or ‘excellent’. However, the majority of HR managers surveyed said they believe they are excelling in this area.

Seemingly, the disparity is due to staff feeling undervalued and unappreciated for their efforts. According to Reward Gateway, 72% of UK staff believe their workplace wellbeing would improve if they were simply thanked for their hard work.

Thankfully, meeting this basic expectation does not require a complete overhaul of your people management strategy. Instead, managers should adopt a transactional leadership style as the best route through this challenging economic period.

Transactional leadership is designed to inspire employees by rewarding high-achievers with bespoke benefits and perks. As an example, a manager in the telesales industry might reward the team member with the highest number of sales with a gift card each month.

By their nature, transactional relationships are self-motivating. Employees will get back what they put in – encouraging people in a way that rewards hard work and ensures fair treatment.

Rob Boland, COO at Reward Gateway, says: “Our new research further suggests that employers and employees need to be connected on all fronts now more than ever.

“Clearly defining the support available to all employees and ensuring that employees feel recognised and valued in the workplace is key for both financial and career wellbeing.”

Gas prices have caused agony among small business owners in recent months, with prices skyrocketing due to inflation and the war in Ukraine.

Many small businesses have been forced to close their premises as energy bills doubled or trebled. 

There may be welcome news on the horizon as gas prices have currently dropped back to more normal levels at the moment. But, a note of caution has already been struck, with warnings about further rises later in the year.

Many small business owners will find themselves looking to change contracts in case there is any option of avoiding the worst impact of further rises.

Gas prices see a drop after months of inflation

After months of rising gas prices, businesses will be desperate for some relief now that gas prices have fallen back to levels not seen in over a year. 

This drop in prices comes after a period of staggering gas price inflation, leaving many businesses struggling to pay their energy bills. Business energy rates were not protected by the same price caps that were put in place for consumers over recent months, causing many to shut up shop altogether.

With the summer months fast approaching, many businesses will be relieved to be able to switch off their thermostats after months of painful winter bills. However, gas usage among businesses goes far beyond keeping the heating on – for the restaurant sector, for instance, there’s far less of a seasonal change.

The calm before the storm?

Despite gas prices dropping to a 15-month low, experts warn that the situation may be temporary.

Speaking at their Vulnerability Summit last month, Ofgem chief executive Jonathan Grearly stated that ‘it is unlikely prices will return to those seen before 2021’.

Worse still, Goldman Sachs predicts a potential threefold increase in gas prices this winter. 

The UK’s potential upcoming gas supply shortage, combined with increased global demand and reduced supply, could lead to continued price volatility. 

Next steps for small business owners

The drop in gas prices is a welcome relief for those who have been dealing with the high cost of energy for months. At this juncture, it may be wise to take advantage and save where you can.

Business owners fretting over their bills have been left to ponder two main concerns:

“Should I lock into a long contract now, or could prices drop further?”

It’s worth heeding Goldman Sachs’ predictions – waiting for further drops could be risky. Considering your budget and energy usage and finding ways to save is all well and good, but if prices suddenly skyrocket again, you could still be left vulnerable. If you are able to find a contract that allows you to lock in at today’s lower prices, this could be a smart option – provided you can find a supplier willing to offer a decent time span without price rises hitting. 

“Can I exit my current contract if it ties me to higher prices, or will there be penalties?”

It’s best to review the terms of your contract and check for any early termination fees or penalties, as every provider is different. If you’re able to exit the contract without incurring significant costs, it may be worth considering a switch to a more favourable plan or provider. However, it’s important to weigh the potential savings against any costs associated with breaking the contract. 

While the current drop in gas prices brings relief to UK small businesses, it’s important to remain cautiously optimistic as future increases could be anticipated. Nonetheless, this temporary respite offers a glimmer of hope, allowing businesses to better manage their expenses and foster growth in the challenging economic landscape.

More on this – see our guide to the top small business gas suppliers