Technology companies expand despite economic concerns, says Intellect

UK technology companies are expecting to expand despite concerns about the economy.

According to a survey of 86 senior UK IT company executives conducted by IT industry body Intellect, 43% say their organisations are very likely to recruit additional staff over the next six months, despite a lack of confidence in the government’s growth strategy and the general economic environment.

Another 40% said it was possible their companies could hire more staff in the next six months.

Technology business executives were more confident about their industry than they were about the wider economy. A total of 51% said business prospects had improved, while 34% said they had stayed the same over the last six months.

A significant 60% said they had increased investment during the last six months.

But only 22% think the national economy will improve over the next 12 months.

The technology sector supports the government strategy for cutting the budget deficit, with 87% either supportive or very supportive. But only 21% expect the government to hit its target.

On the government’s growth strategy, only 67% of tech bosses are confident and none are very confident in it.

Antony Walker, Intellect’s deputy director general, said there is a divide between how confident business leaders feel about the prospects for their own business compared to the economy as a whole. 

“Despite the difficulties, it appears that companies have invested during this year and are now looking to maximise that investment,” said Walker.

But he warns that these gains could be quickly lost. 

“The industry agrees with the chancellor that technology can be an engine for growth, but the worrying thing is that business leaders don’t feel the government fully understands the sector and the opportunities it can create,” said Walker.

He said technology firms are concerned about skills shortages, in the short and long term.  

“Skills shortages will have an impact on the ability of companies to turn their ambitions into real jobs,” said Walker.