The German-British Business Outlook

Assessing the performance of their own activities in the UK, the German-British Business community is more optimistic than six months ago. This is partly down to the improved sentiment towards the overall development of the UK economy.

• As a result of the increase in confidence, more than 40% of respondents will invest more in the medium term and a similar number expect to employ more staff.
• The main reason for investing in the UK continues to be the importance of the British market with 70% planning to invest in sales and marketing activities. However, the UK’s appeal as a manufacturing location should not be underestimated, as approximately 15% of respondents plan increase investment in production and manufacturing activities - a higher share than the manufacturing sector’s overall contribution to the UK economy (10%).
• Political uncertainty and the lack of demand (despite the somewhat improving economy) continue to feature most prominently as challenges for our businesses. These are followed by trade barriers, shortage of skills, and regulatory uncertainty. In comparison to our survey results in 2023, energy costs are having a smaller impact on business operations, moving from most (in spring 2023) to third most influential factor (in autumn 2023) and now settling in twelfth position.
• With regard to long term geopolitical challenges, political “interference” in supply chain structures, the drive to sustainability and the digital transformation is what keeps companies awake at night. However, overall they feel relatively well prepared to face these challenges.
• In terms of the effectiveness of the UK government’s policies to address climate change, the survey results suggest that our respondents do not think that UK policy has become more effective over the last two years.
• 64 online interviews were conducted with members of the German-British business community with UK operations.

Click here for the full results