New research has indicated that 83% of tech leaders are concerned about a looming recession.
B2B tech PR agency CommsCo surveyed 185 UK IT founders and leaders to uncover the concerns felt in the face of the current economic climate.
It found that 37% believe the economic climate is the biggest threat to their business, followed by staff retention (26%).
More than three-quarters believe the recession will affect investment in the tech market. Plans to protect against recession include increasing the cost of services (49%) and reducing marketing spend (47%).
On a positive note, 59% are optimistic for 2023, and 52% plan expansion in the next 12 months.
45% think remote working will have a negative impact in an uncertain economic environment, and that people need to be together in an office environment to ensure maximum productivity and collaboration; while 44% believe remote working is a positive change for mental wellbeing and potential office cost savings.
Leaders were completely divided when it came to advising other entrepreneurs to set up in this environment, with 47% believing they would encourage them vs 43% saying the opposite.
Adam Hale, board advisor for a number of tech companies, described the current environment as an “interesting time for startups and scaleups in the UK tech sector”.
Hale is chair of Arctic Shores, Clue and Orbus Software, as well as the ScaleUp Institute.
“[We have] revised valuations, COVID, Brexit, war, rising prices, political instability and a looming recession,” he said. “Recessions don’t have to be bad news, they are an opportunity for the best firms to demonstrate their market leadership and come out stronger.
“That means keeping closer to their customers than ever before and driving the quality of everything they do up, mistakes are not forgiven in a recession. Some companies will not make it, but as they say in a tornado even turkeys can fly.”
When asked what has been the single worst event for business, 43% respondents pointed to COVID, followed by Brexit (25%) and war in Ukraine (18%). The 46% that stated outgoing Prime Minister Boris Johnson was bad for tech business will be pleased with recent events.