Be the Business Productive Business Index - Edition Seven, Q1 2024

Be the Business' seventh edition of the Productive Business Index demonstrates higher levels of confidence and optimism amongst UK SMEs.

The Productive Business Index (PBI) series, first published in 2021, track changes over time in five key capability areas to understand what actions SMEs are taking to improve their productivity. The PBI also measures general operating conditions, barriers to growth and expectations for the future.

While previous editions had seen a decline in the PBI from Q1 2022, this latest report saw an increase of over 2.5 points, driven by a strong growth in activities to improve productivity being undertaken and planned by businesses.

The data also revealed a gain in performance indicators, driven by optimism about future trading conditions.

Key findings include:

• 38% of business leaders predict increased revenues over the next 3 months - the most positive forecast since the first edition of the PBI in 2021

• 45% of younger business leaders (18-34 years) say the financial situation of their business improved over the last 3 months, compared to just 22% of business leaders aged 55+

• 70% of business leaders say their business has the skills and talent they need to succeed – the highest level recorded by the PBI

• The UK’s Confidence-Action Gap, which highlights the discrepancy between UK SMEs’ confidence levels and the actions they take to improve productivity, remains evident and unchanged from one year ago, at 24%.

Addressing the Confidence-Action Gap, which Be the Business discovered as part of our work analysing productivity amongst SMEs within the G7, was a central focus of the Be the Business Manifesto, published in early 2024.

In addition, business leaders are split on their hopes for the next government: 32% of business leaders believe their business will be better off under a Labour Government, while another 32% of business leaders believe their business will be better off under a Conservative Government.