A new study from the University of Salford has found that 57% of microbusinesses in Greater Manchester are struggling to adopt new technologies due to time constraints, while 43% face barriers accessing adequate training hindering productivity amid economic uncertainty.
Microbusinesses, which are those with fewer than 10 employees, make up 95% of all UK businesses, playing a vital role in economic growth, employment, and innovation. The research, which surveyed 269 microbusinesses in Greater Manchester, found that while almost half reported a positive impact on productivity from technology adoption, many still face significant obstacles in accelerating digital transformation.
Despite 49% acknowledging that digital tools significantly enhanced productivity, challenges remain. Eighty-nine percent expressed concerns over the cost of new technologies, 35% cited a lack of sufficient advice as a key barrier, and 43% struggled to access adequate training. These findings come as UK productivity lags around 19% behind the US, with sluggish growth continuing to pose economic challenges.
The most commonly adopted technologies among surveyed microbusinesses were accountancy software (73%), cybersecurity tools (67%), and project management tools (66%). These tools have been crucial in streamlining operations, improving data security, and boosting efficiency.
Professor Mandy Parkinson, Professor of Business Innovation at the University of Salford Business School, said: “Microbusinesses make up the vast majority of UK businesses and are a huge driver in the country’s economic growth and stability. However, digital transformation is critical for peak productivity and efficiency, and many continue to face barriers to technology adoption which could be impacting long-term success.
“Half of our respondents confirmed the considerable positive impact adopting new technology had on their business, underscoring the transformative potential of digital tools in modern business operations.”
She added: “The pandemic accelerated the adoption of new technology due to the shift to remote working, as well as evolving ways of working in the years following. However, as technological advancements continue to move at rapid pace, it’s essential momentum continues beyond just during times of crisis, if we’re to enhance our productivity growth,” continued Mandy.
A recent McKinsey Global Institute survey found that 87% of companies worldwide are experiencing – or expect to face – skills gaps within five years, further threatening productivity and competitiveness.
“It’s clear many microbusiness leaders are keen to drive the digital transformation of their organisation. However, the barriers they face are incredibly challenging to overcome. This, combined with skills shortages, is making it near impossible for businesses to move forward when it comes to effectively adopting new technologies for long-term success.
“As microbusinesses continue to navigate an increasingly challenging climate, support from policymakers, improving access to government grants, enhancing training and support, as well as tailored interventions will be crucial in sustaining their growth and innovation.”
