London - Last week's annual vanity project for the leaders of big business and their friends in government - otherwise known as the World Economic Forum in Davos - promised to tell us how “mastering the fourth industrial revolution” would enable us to “transform entire systems of production, management and governance” and “raise global income levels and improve quality of life”.
For which one might feel grateful, were it not for the forum's usual failure to invite any of the entrepreneurs and small business leaders who, back in the real world, are actually doing most of the work driving the global economy.
Instead, Davos featured the same tired old line-up of chief executives of global businesses and their acolytes, whose companies paid hundreds of thousands of pounds for the chance to attend this annual festival of corporate lobbying.
To see why this matters, consider the statistics. In the UK, small and medium-sized enterprises (SMEs) now represent 99 percent of all private businesses, account for 60 percent of private sector employment and produce roughly half of all the turnover generated by private businesses. Even more significantly, studies have suggested these firms are behind three-quarters of new jobs in the UK economy; the OECD's data, moreover, suggests the UK is pretty typical of developed economies in these regards.
In other words, any country that wants to boost economic growth and increase rates of job creation needs to focus on its SMEs. It is their views we should be listening to and their problems we should be prioritising for solutions.
At the World Economic Forum, however, that's not what's happening at all. “Davos is remote and completely out of touch with the economic realities faced by entrepreneurs and the owners of small and medium-sized businesses,” says Stephen Kelly, the chief executive of the software and services firm Sage, which specialises in working with SMEs.
In fact, Kelly is so outraged by Davos's lack of relevance that he's commissioned research among SMEs to get their views. “We found just 4 percent believed that Davos had any relevance to them,” he says. “In fact, 60 per cent didn't even know it was happening.”
It is, of course, the right of any group of wealthy individuals to gather half way up a mountain to discuss what they feel are the issues of the day. But the problem is that Davos sets the agenda: policymakers and civil servants return from the event with a new perspective on what their priorities should be, and the disproportionate outside interest in the meeting (including from the media) drives this process. Never mind that the agenda in question reflects the wants and needs of only very large businesses.
This year's meeting is a case in point. Set against a backdrop of concern about slowing growth in China and global stock market volatility, the meeting was dominated by macro-economic debate and power plays between central bankers, politicians and institutions such as the IMF.
Back in the real world, meanwhile, SMEs report reasonable levels of optimism about the year ahead - the latest confidence index from the Federation of Small Businesses is upbeat, for example - and would be even more positive if anyone bothered to listen to them.
“The real heroes of the economy aren't even in the room at Davos,” Kelly adds. “The result is that the agenda it drives is completely unrepresentative of the issues they face.”
This doesn't go unnoticed. Entrepreneurs are battling to deal with challenges such as a higher minimum wage and the cost of the auto-enrolment pensions regime; their growth strategies are frustrated by the failure of customers to pay their bills on time; they're held up by endless delays over major infrastructure projects such as the Heathrow/Gatwick debate; and they're at the mercy of their banks. And while they concentrate on creating jobs in the face of so much adversity, they see their political leaders hanging out with the global elite rather than addressing the challenges back home. They must be tempted to think: why bother?
THE INDEPENDENT