Finance leaders across the UK are optimistic for the a return to economic growth in 2021, according to a survey of Chief Finance Officers (CFOs) by Big 4 accountancy firm, Deloitte.
Despite confidence in the national economy however, half of CFOs surveyed do not expect a return to pre-Covid demand levels until the final quarter of the year at the earliest.
71% of finance leaders from some of the UK’s largest businesses were optimistic that corporate revenues to rise over the course of 2021. Just over half also expected operating costs to increase also: 98% of CFOs surveyed expected to see increased taxation, and two-thirds predicted increased regulation.
Jodi Birkett, partner at Deloitte in the North West, commented:
Boosted by the prospect of Building Back Better, and mass vaccination set to get underway, business sentiment surged last quarter, with CFOs taking the most positive view on profit margins for the last five years. This rebound in sentiment occurred despite a backdrop of continued Brexit negotiations and with two thirds of CFOs believing that a no-deal outcome would have a severe or significant negative effect on the economy.”
Finance leaders also expected the pandemic to have lasting consequences for businesses, with 98% expecting flexible and home-working to continue and increase. Jodi Birkett continued:
“The pandemic has triggered fundamental and lasting changes in business, with CFOs expecting rising levels of home-working, greater diversification of supply chains and increasing investment in technology. However, CFOs are optimistic about operating in this changing world, with a return to growth expected this year.”
Data was collected between 2nd and 14th December, ahead of additional Covid-19 restrictions being introduced, and the agreement of a Brexit trade deal. 90 CFOs took part in the survey from UK-listed companies worth a combined £308 billion.