Recession in UK 'is months away' is the big news headline today, with a change of view from British Chambers of Commerce, their news releases has been picked up by most of the media.
BCC now predicts a UK recession, 250-300,000 job losses and no recovery for at least 2 years.
Frankly, it is not really news anymore as anyone who reads the press, listens to the news and works in SME business will know, this has been discussed for some months now.
What's new? The fact that many august organisations like British Chambers of Commerce are now having to redraw their forecasts and withdraw some of their commentary, replacing it with less optimistic and rosy rhetoric now.
Economists like Ambrose Evans-Pritchard, Tim Congdon and others have been forecasting recession for some months. Indeed Evans-Pritchard reporting on the Budget on 13th March 2008 in the "Daily Telegraph" said:
"Britain is at risk; it duplicated the USA bubble and must suffer the same fate. The UK is merely 9 months behind. America tipped last autumn - Britain will tip this summer". By tip he means Britain will start to tip into negative growth by summer 2008. At that time he was shouted down by scores of people, BCC were like Mr Darling, forecasting 2.5% growth then. What price their scorn now?
I have been using a very long email signature at the end of each email message for 6 months now. In it I say cut costs NOW and preserve cashflow NOW. BCC are now effectively joining this siren call in warning for recession and 300,000 jobs being lost in the next 18-24 months.
This would suggest that their economists see difficult times ahead for the SME sector until late 2010.
What can SME's do now? I keep going back to my email signature, get ready now if you have not already. Cut costs, reduce overheads, try to increase prices and margins, manage your cashflow daily, oh and get the tin hat on.
Economists are saying we are going to have 24 months or longer of stagnation, then recession, then stagnation then slow growth maybe starting early 2011.