Over the course of 2022, UK businesses have entered a new reality with an impending economic crisis coupled with a soaring cost of living, and companies of all sizes are now focussing more than ever on where their money will be best spent.

The Office of National Statistics recently announced that the UK unemployment rate has risen by 3.6% since September and according to the Bank of England, inflation in the UK will reach a peak of over 13% and stay above 10% for most of 2023. These growing challenges have also hit overseas as US tech giants Amazon declared they are cutting 10,000 corporate and tech jobs, following similar announcements by other big organisations. It’s clear that a worldwide economic crisis will have a growing impact in the months going into 2023.

From talking to industry leaders, businesses are determining the next steps within an unclear path as people prepare for further economic strain in the UK with cost savings on everyone’s minds. The first thing businesses will think to do is review their teams and projects, asking the questions: “do we need this team”, “does this need to be developed right now”, and just focusing on the vital pieces of work. Financial concerns may or may not be on the horizon, but some have already forecasted that they won’t be growing at previous levels of around 10-30% due to the ongoing trends.

Given these growing concerns, it can be argued that the amount of work and benefits of technology are equal to the worries. Attitudes are changing, it is no longer about growing at all costs but scaling efficiently to stay ahead of the curve of these demanding times.

Despite a cloudy outlook in the coming months and 37% believing the economic climate is the biggest threat to their business, it’s positive to see that nearly 60% are optimistic about the prospects in 2023, with 52% planning to expand during the next year.

Businesses are continuing to accelerate their investment in tech to benefit them long term, rather than opting to cut in the short term. Findings from KPMG show that despite rising costs and economic uncertainty, businesses plan to advance their digital transformation journeys. A recent report also found that 65% of its respondents believe that technology is the biggest driver of growth for medium-sized businesses and agree more can be achieved with technology. By focusing next year’s roadmap on digital transformation, businesses can use this opportunity to develop and grow to move with the changing world.

Just as we were recovering from the impact of the last 2 years, we are now emerging into a challenging new reality for tech businesses and start-ups, but the difference this time is that technology will come out stronger than ever. Digital transformation will remain the biggest driver for businesses, and with the right planning and technology resources, businesses have the tools to not only survive but thrive in the new climate.