This page includes relevant UK business statistics for 2023, such as growth and borrowing across various sectors, the impact of the cost of living crisis, and how the UK business landscape compares to previous years.
It has been a difficult time for those running a business over the past 15 years, with the 2008 financial crisis, Brexit, the COVID-19 pandemic, and the cost of living crisis affecting the stability of businesses across many industries.
Despite this, the latest UK business statistics found that, in 2022, there were 5.5 million businesses registered in the UK – with 99.9% of these classified as small to medium-sized enterprises (SMEs).
Delve deeper into the business landscape and explore the UK business market further with our comprehensive business statistics and facts for 2023.
As of October 2022, there are 5.5 million private sector businesses (down 1.5% or 82,000 from the previous year).
Total SME employment in 2022 was 16.4 million (around 61% of all private sector jobs).
The 7,675 large firms (250+ employees) in the UK accounted for just under half (49%) of the overall earnings.
More than half (56%) of the businesses in the UK are sole proprietorships.
In 2022, there were 4.2 million businesses in the services industry – 76% of the overall business population.
London has the highest number of businesses per resident of any region in the UK (1,402 per 10,000 residents).
Gross lending (excluding overdrafts) to SMEs by all UK banks in 2022 was £65.1 billion – up 12.8% from £57.7 billion in 2021.
As of October 2022, there were 5.5 million private sector UK businesses – a decline of around 1.5% (or 82,000) from the previous year. The private sector is largely made up of self-employed owner-operators, sole traders, and small business employers. In fact, SMEs account for more than 99% of all the businesses in the UK.
Of the 5.5 million private sector businesses in the UK, 1.4 million had employees, and 4.2 million had no employees (in other words, self-employed), which means roughly 75% of businesses didn’t employ a single person aside from the owner(s).
|Employee size band||Businesses||Employment (in thousands)|
|SMEs (0-249 employees)||5,501,760||16,432|
|Small businesses (0-49 employees)||5,465,320||12,936|
|With no employees||4,061,035||4,399|
|1 to 9 employees||1,187,045||4,309|
|10 to 49 employees||217,240||4,228|
|20 to 49 employees||75,585||2,290|
|50 to 249 employees||35,940||3,497|
In 2022, there were 5.47 million small businesses (0-49 employees), accounting for 99.2% of the total business population in the UK.
There were a further 35,940 medium-sized businesses (50-249 employees), accounting for 0.7% of total businesses.
A total of 7,675 businesses were considered “large” (250+ employees), making up just 0.1% of the UK’s business population.
The latest UK small business statistics found that, in 2022, SME employment stood at 16.4 million. This figure represents a 0.6% rise (+0.1 million) from 2021 and accounts for 61% of all private sector jobs. This means SMEs account for more than three in every five people employed in the UK private sector.
To break it down further, employment in small businesses was 12.9 million (around 48% of all private sector jobs), and medium-sized businesses was 3.5 million (13% of private sector jobs), according to small business statistics.
Despite having a smaller share of businesses, the 7,675 large firms in the UK make a significant contribution to employment and the nation’s turnover. In 2022, they employed 10.6 million people (39% of private sector jobs) and had a turnover of £2 trillion, equating to just under half (49%) of the UK’s overall earnings.
There are two million more businesses in the UK in 2022 than there were in 2000, with total numbers rising from 3.5 million to 5.5 million (+57%) over this period. Despite this, the latest figures represent a fall from the beginning of 2021 when there were 5.6 million, and a further decline from 2020 when there were 5.9 million. This is a decrease of 7.9% – or 471,600 businesses – in the space of two years.
The figures for the total number of registered UK businesses in the past few years have been directly affected by changes to the way property is taxed.
In April 2020, buy-to-let tax changes came into full effect, meaning that landlords could no longer deduct any of their mortgage expenses from their rental income to reduce their tax bill. Since then, landlords receive a 20% tax relief on mortgage interest payments instead. As a result, many landlords registered their properties as businesses for the first time.
Data from Companies House found that, during 2020, there were a record number of new limited companies (also known as incorporations) to hold buy-to-let properties. In 2020, 41,700 buy-to-let incorporations were set up – a rise of 23% from 2019 – which increased further to 47,400 in 2021.
Between September 2021 and September 2022, there were roughly 50,400 buy-to-let companies set up (+6.4%), taking the UK total past 300,000. Recent buy-to-let statistics found that the average landlord has 4.8 buy-to-let mortgages, with 60% landlords funding some of their portfolio through buy-to-lets.
The average age of a company has gradually declined from 10.7 years in 1999-00 to 8.6 years (-20%) in 2021-22.
Since 1999-00, the steady decline in the average age of a company could be due to the general increasing trend seen in the number of incorporations and dissolutions. Therefore, it is likely that the increasing number of incorporations has led to a greater number of younger companies on the register, which lowered the average age of companies overall as a result.
The most recent UK business report shows a modest rise in business age from 8.5 years to 8.6 years (+1%) between 2020-21 and 2021-22.
A recent UK business report found that around seven in 10 (72.1%) UK businesses in 2022 had been in existence for less than 10 years.
Nearly four in 10 (36%) were aged between one and four years, with a further 21% aged between five and nine. Less than 6% of companies had been around for 30 years or more, with just 1.3% exceeding 50 years in business.
The total register size – including those in the process of dissolution and liquidation (305,890) – at the end of March 2022 was 4,894,356. When compared with the same period in March 2021, this is an increase of 3.9%. Disregarding businesses in the process of dissolution or liquidation, the number of registered businesses was 4,499,342.
Regionally, England and Wales had the highest number of registered companies, with a combined total of 4,578,267 businesses – up 3.8% from 2021. The latest UK business stats found that Scotland had 242,251 registered companies (+2.2%) and Northern Ireland had 73,838 registered firms (-4.8%).
From March 2021 to March 2022, there were 753,168 new businesses – a decrease of 7.1% from the previous year when the total number of business launches reached its highest total since records began (810,316). Despite the decline, the most recent figure is still the second-highest total on record and around 13% higher than two years previously.
In 2022, there were 581,824 company dissolutions – an increase of 32.9% compared with 2020-21 and the highest number of dissolutions on record. It is worth noting that compulsory and voluntary dissolutions were paused for approximately eight months during 2020-21 at the height of the COVID-19 pandemic. This means that the most recent figures may have been boosted by the inclusion of businesses that would have typically been dissolved in 2020-21, had this legislation not been in place.
Regionally, the highest rate of increase in the number of dissolutions in 2021-22 was found in England and Wales (+33.6%), followed by Northern Ireland (+26.1%), and Scotland (+21.6%).
Despite these fluctuations, the number of incorporations and dissolutions over time has increased consistently. There were 635,368 more incorporations in 2020-21 compared to 1986-87 when records began, and 497,624 more dissolutions.
If you’re interested in reading more small business statistics, we’ve collated the latest facts and statistics on UK businesses including; growth, profits, sectors, business failure and how COVID-19 affected SMEs.
There are three main legal forms of business in the private sector:
1. Sole proprietorships: A business owned and run by one person, and there is no legal distinction between the owner and the business entity.
2. Ordinary partnerships: A business owned and run by two or more people. No formal agreement is necessary, and partners share risks, costs and responsibilities.
3. Companies: A business owned by its members. There is limited liability, which means the company’s finances are separate from the personal finances of its owners, and creditors may only pursue the company’s assets to settle a debt.
In 2022, more than half of the UK private sector was taken up by sole proprietorships (56%) or self-employed businesses. Just over a third of businesses were actively trading, and 7% were ordinary partnerships.
|Business type||Number of businesses||Percentage of all businesses||Businesses with employees||Businesses with no employees|
|Sole proprietorships||3.1 million||56%||220,000||2.9 million|
|Companies||2.1 million||37%||1.1 million||932,000|
Over the years, the popularity of the three legal forms of business have changed. Between 2021 and 2022, the number of companies increased by 16,000 (0.8%), sole proprietorships decreased by 69,000 (2%), and ordinary partnerships decreased by 32,000 (8%).
By comparison, in the period between 2012 and 2022, the number of sole proprietorships grew by 87,000 (3%), and the number of companies increased by 704,000 (54%). However, the number of ordinary partnerships fell by 96,000 (21%).
Further to this, SME Finance Monitor reports that, in 2021, 72% of companies had one owner. This means that, of all SMEs, 84% were either sole proprietorships or companies with one owner – higher than the 75% recorded in 2020.
This number is likely due to the uptick in people deciding to start a side hustle or go it alone and start up their own business following the Great Resignation towards the end of 2020. Of these business owners, 9% ran more than one business.
A recent UK business report found that, in 2021, 80% of SMEs were defined as family-owned businesses – up from 77% in 2020. Of the smaller enterprises, 82% of micro-businesses were considered family-owned, along with 69% of small businesses and 57% of medium-sized companies.
Primary (Agriculture, Mining, Fishing, Forestry) (90%)
Retail and wholesale (87%)
Transport, accommodation and food (83%)
Between 2021 and 2022, there were 1,014 businesses per 10,000 resident adults in the UK. This number was even larger in London, with 1,452 businesses per 10,000 residents – the highest number in UK countries and English regions.
The “North-South divide” is very much apparent in the number of companies, as there were just 704 businesses per 10,000 residents in the North East – the lowest business density rate of all UK countries and English regions.
In terms of the number of businesses, a third of the UK business population (34%) can be found in London or the South East, with 1 million and 844,000 businesses respectively.
Of these businesses, there are approximately 1.036 million SMEs in London, which account for 99.8% of all businesses in the capital. In the South East, there are around 843,000 SMEs, which account for 99.9% of all businesses in the region.
|Region||Number of enterprises (2022)||Percentage change from 2021||Number of employers||Number of SMEs|
|Yorkshire and Humber||386,000||-7%||108,000||385,000|
|East of England||543,000||-4%||143,000||542,000|
Between 2021 and 2022, the overall number of businesses declined by 2% in England but increased throughout the rest of the UK. Wales was the country that experienced the largest increase in total businesses (5%), followed by Northern Ireland (4%), with Scotland’s numbers remaining largely unchanged.
The number of private sector businesses decreased in most English regions, with the largest percentage fall documented in Yorkshire and Humber, where the number of businesses fell by 7% (28,000). Yorkshire and Humber was followed by the South East and East of England, which both experienced declines of 4%.
The only English regions to experience an increase were the South West and North East, which saw rises of 3% and 1%, respectively.
Since 2010, the number of businesses has increased in all the UK countries and regions. The most significant increase has been in London (45%), and the smallest increase has been in Northern Ireland (7%).
In a bid to find out which university produces the highest percentage of business founders, our exclusive study looked at the number of listed founders for universities across the UK. By comparing this figure with the total number of listed alumni (or former students) in each establishment, we were able to rank each university by the percentage of alumni that went on to start their own business.
Our independent study found that universities in London dominated when it came to producing business founders, with seven of the top 10 based in the English capital.
With nearly 30,000 founders across 268,000 listed alumni, The London School of Economics and Political Science (LSE) was found to be the UK university with the highest percentage of business founders. With 11.1% of its former students listed as founders, LSE was the only UK university where more than 10% of alumni have gone on to start a business.
|University||Listed alumni||Listed founders||Founders %|
|London School of Economics and Political Science||268,186||29,767||11.1|
|The University of Oxford||278,988||27,300||9.79|
|University of the Arts, London||204,782||20,028||9.78|
|The University of Cambridge||359,917||32,179||8.94|
|Imperial College of Science, Technology and Medicine||149,740||13,368||8.93|
|University College London||241,122||20,688||8.58|
|King's College London||203,407||16,214||7.97|
|The University of Edinburgh||181,363||13,802||7.61|
(Source: Money.co.uk via LinkedIn and HESA)
Though second-placed Oxford University had 36% more founders than third-place University of the Arts, it had substantially more alumni, meaning its overall founder percentage was just 0.1% higher (9.79% vs 9.78%). Similarly, though fifth-placed Cambridge University was found to have the most founders of any establishment (32,719), it also had the highest number of alumni (359,917) – resulting in an overall percentage of 8.94%.
The University of Edinburgh was the only non-English university in the top 10, finishing tenth with a total of 13,802 founders (7.61%). There were no universities from the North of England, Wales, or Northern Ireland in the top 10, with the University of Durham (23rd), Cardiff University (63rd), and Queen's University Belfast (109th) being the highest-ranking universities from these places, respectively.
|University||Listed alumni||Listed founders||Founders %|
|Edge Hill University||36,821||812||2.21|
|Harper Adams University||11,829||289||2.44|
|University College Birmingham||15,850||391||2.47|
|University of Suffolk||16,143||413||2.56|
|University of the Highlands and Islands||12,270||335||2.73|
|The University of the West of Scotland||66,286||1,849||2.79|
|Liverpool Hope University||19,679||560||2.85|
|Glasgow Caledonian University||99,806||2,882||2.89|
(Source: Money.co.uk via LinkedIn and HESA)
Universities with the lowest percentage of business founders were more geographically diverse than those with the highest numbers – every UK country had at least one university in the top 10.
With less than 1,000 founders (812) out of nearly 37,000 alumni, Lancashire’s Edge Hill University was found to be the UK university with the lowest percentage of founders (2.21%).
Edge Hill was followed by Harper Adams University in Wales which obtained a slightly higher founder percentage (2.44%), despite having around 64% fewer founders than Edge Hill and the lowest total of any university (289).
The University of the Highlands and Islands was the university with the lowest founder percentage in Scotland, with its total of 2.73% the fifth lowest in the UK overall.
Northern Ireland’s Ulster University had more founders (3,226) than the other universities on the list, but its comparatively high alumni count of 116,088 gave it the sixth-lowest founder percentage overall (2.88%).
The latest UK business statistics show that the highest number of graduate founders came from degrees relating to business or finance, with each of the top three degrees related to one or both of these subjects.
Business admin and management was found to be the degree that produced by far the most founders. With an overall total of 67,491 graduate founders, the subject produced 21% more founders than the second-highest degree (economics) and 58% more than tenth-placed law.
There is a considerable gap between the top three degrees and the rest of the degrees in the top 10. Business admin and management, economics, and business/commerce are the top three degrees and their combined figures account for around 43% of the total founders in the top 10.
While there is a gap of just 6% between second-placed economics (53,619) and third-placed business/commerce (50,382), this is followed by a drop of 22% between the latter subject and fourth-placed marketing (39,358).
The remaining degrees in the top 10 have more comparable numbers, with just over 5,000 founders separating maths in fifth place and tenth-placed law – a gap of around 16%.
Computer games and animation was found to be the degree that produced the lowest number of business founders, with its overall total of 671 around 47% less than the next lowest degree (health services, allied health, and health sciences), and 99% less than business admin and management (the degree with the highest number of founders).
Graduates in subjects related to health or social care were found to be less likely to form businesses, with 50% of the degrees with the least founders related to one or both of these subjects. Of these degrees, eighth-placed biomedical sciences was the degree with the most founders (2,294).
Though tourism and travel services management was found to have the tenth lowest number of founders, its total of 4,467 meant that it produced 28% more founders than cinematography and film/video production in ninth. Additionally, tourism and travel services produced over six times more founders than computer games and animation (the degree with the lowest number of founders).
A UK business report from Statista found that the median profit of SMEs in the UK was approximately £11,000 in 2021. Of all the industries in the UK, SMEs in the property and business services and the wholesale and retail sectors had the highest average profit (£13,000).
At the other end of the scale, the health and social work sector made the least average profit in 2021 at £9,000. Health and social work’s profits were 10% lower than the next lowest sectors, with transport and hotels & restaurants both recording median profits of £10,000.
As of the fourth quarter of 2021, 53% of SMEs in the UK reported that they had made a profit in the previous 12 months, compared with 7% that broke even, and 18% that made a loss.
Business income statistics found that the share of SMEs making a profit remained stable until 2020, when it fell from 73% in the first quarter of that year to 47% in the second quarter of 2021. Following a peak of above 20% in Q2 2021, the share of companies reporting a loss had fallen to 18% by the fourth quarter 2021.
At the end of Q4 2022, 53% of SMEs were borrowing more than they had before the pandemic: 23% had started borrowing, 18% had taken on additional borrowing, and 11% were making more use of existing facilities.
Those with 1-9 employees were most likely to have increased their borrowing (56%), as were those in the hotel and restaurant (62%) and healthcare (68%) sectors, compared to 45-59% in other sectors.
A third (33%) of new borrowers were worried about repaying their facilities, as were the 27% who’d taken on additional borrowing, according to recent UK business stats.
Overall, the equivalent of 7% of all SMEs expressed concern about repayments, which can negatively affect your business credit report.
Gross lending (excluding overdrafts) to SMEs by all UK banks in 2022 was £65.1 billion, according to the Bank of England. This was up 12.8% from £57.7 billion in 2021 and is the second-highest number on record.
The only year to date that has exceeded this figure was 2020, when borrowing accelerated past £100 billion (£104.8 billion) at the height of the pandemic. The record gross lending in 2020 was driven by the Bank’s Coronavirus Business Interruption Loan Schemes, particularly the Coronavirus Business Interruption Loan Scheme (CBILS) and the Bounce Bank Loan Scheme (BBLS), which were the most relevant to SMEs.
While gross bank lending in 2022 was significantly higher than in both 2021 and 2019, the difference becomes less pronounced when you include inflation. In real terms, gross lending in 2022 was £62.3bn – up £4.6 billion (8%) from 2021 but only £2 billion (3.3%) higher than in 2019. Overall, this figure was lower than in five of the previous seven years.
According to a UK business report from SME Finance Monitor, overall application success rates across all products was 62% from Q3 2021 to Q4 2022. This was down 23% from the same period a year earlier and 9% lower than pre-pandemic figures.
The report also found that:
Larger businesses saw higher success rates across their applications, with an acceptance rate of 94% for companies with 50-249 employees compared to just 56% for businesses with no employees.
The main reason for additional funding was to manage cashflow, with seven in 10 businesses (69%) seeking credit for this reason.
Business development was the next most popular reason for credit (37%) followed by expansion (19%), and machinery (14%).
Of those that applied for finance, half sought a traditional bank loan (50%) with a further 17% applying for a bank overdraft.
Around one in 20 applied for either leasing and hire purchase (6%) or a business credit card (5%), with 1% applying for invoice finance.
|Why was funding required?||All SMEs||0 employees||0 employees||10-49 employees||50-249 employees|
|Cash flow related||69%||70%||64%||64%||62%|
|Working capital to help with cash flow||49%||50%||44%||49%||55%|
|To cover a short-term funding gap||36%||39%||29%||21%||9%|
|To cope with the impact of the pandemic||20%||22%||16%||13%||1%|
|To help through trading difficulties||24%||26%||18%||11%||2%|
(Source: SME Finance Monitor)
The same report found the percentage of businesses needing credit for cashflow purposes decreases as the size of SMEs increases. While 70% of businesses with 0 employees sited cashflow as a primary reason, this fell to 62% for businesses 50-249 employees.
A similar trend can be found when looking at businesses seeking credit to cope with the impact of the pandemic, with just 1% of SMEs in the largest category (50-250 employees) requiring credit for this reason.
|Why was funding required?||All SMEs||0 employees||0 employees||10-49 employees||50-249 employees||2019||2020||2021||2022|
|Business development related||37%||36%||40%||39%||38%||58%||24%||24%||37%|
|Invest in a new plant, machinery, etc.||14%||14%||16%||16%||23%||25%||9%||11%||14%|
|To fund expansion in the UK||19%||20%||16%||13%||8%||20%||11%||9%||19%|
|A new business opportunity||11%||11%||11%||7%||12%||13%||4%||5%||11%|
|To fund research and development||5%||5%||4%||2%||X||N/A||N/A||N/A||N/A|
|To fund new premises||3%||2%||5%||5%||X||7%||1%||2%||3%|
|To take on staff||4%||4%||5%||7%||3%||5%||2%||1%||4%|
|To fund expansion overseas||N/A||N/A||N/A||1%||5%||3%||1%||1%||3%|
(Source: SME Finance Monitor)
Bank of England figures show the demand for lending has eased, driven in part by the post-pandemic changes to smaller businesses’ debt positions and a lack of business investment. Following the annual growth rate of lending to SMEs reaching record lows in mid-2022, the figure increased slightly to -3.8% by November 2022.
These low-lending figures occurred despite small businesses making net debt repayments totalling £65.7 billion in 2021 – up 14% from 2020 and 19% higher than 2019 – and close to £1 billion in March 2022 alone.
According to SME Finance Monitor, this could also be because more than three in 10 SMEs (34%) injected personal funds into their business in 2022, down from 37% in 2021 but greater than 2020 figures. Just under a quarter of all SMEs (22%) said that it was something they felt they “had” to do – up from 11% in 2019.
According to a UK business report from SME Finance Monitor, 36% of SMEs used external finance in 2022. This aligns with 2020 levels (37%) after an increase in 2021 (43%).
The decrease in use was seen across all SME categories, with the largest SMEs (50-249 employees) the least likely to be using external finance (32%), and the highest use amongst those with 10-49 employees (57%). From an industry perspective, those trading in wholesale and retail were most likely to use external finance (42%).
What is external finance?
Sources of finance that come from outside a business. These include friends and family, bank loans and overdrafts, venture capital and business angels, new partners, share issue, trade credit, leasing, hire purchase, and government grants.
The widespread usage of the Bounce-Back Loan Scheme (BBLS) and pandemic-related grants meant these were the most common finance forms SMEs applied at the height of the pandemic. The discontinuation of this scheme in March 2021 has halted the decline previously seen in applications for many traditional SME finance options like business loans, prepaid business cards, and business current account overdrafts.
The number of SMEs seeking bank loans and private lending has increased (both +3%) while the number applying for a bank overdraft has remained unchanged, according to UK business stats.
The biggest fall in applications was found in government and local grants, which more than halved from 26% to 12% between 2021 and 2022.
Though only 12% of SMEs applied for a credit card in 2022 (-1% from 2021), most companies still see business credit cards as an essential tool, with Forbes finding that two-thirds (67%) of small businesses have a company credit card. Despite this, just a quarter (24%) say it’s their primary method of business spending.
Businesses with employees are more likely to seek external finance (50%) or non-government-backed finance (47%) than firms with no employees (35% and 31%, respectively).
Furthermore, employers are more likely to seek higher values than zero-employee companies. In fact, in 2022, more than half (51%) of SME employers sought external finance exceeding £25,000 – double the number of companies with no employees (25%).
|Type of business||Median value 2021||Median value 2022|
(Source: British Business Bank)
Companies with no employees were most likely to seek a median of £10,000 in external finance, compared with SME employers seeking a median of £25,000. The figures for both are identical to the figures recorded for 2021.
The median loan value when factoring in all companies is £14,000 – up 40% from 2021 (£10,000).
Before the pandemic, demand for finance from ethnic minority-led businesses was similar to that of other firms. UK diversity in business statistics found that applications increased significantly among all smaller businesses from Q2 2020 to Q2 2021, but the increase was far greater among ethnic minority-led businesses.
There was also an increase in the use of finance, with around half (51%) of ethnic minority-led businesses using finance from Q2 2020 to Q2 2021, significantly above other businesses.
Increased use of finance has been driven by increased take-up of small business loans, particularly government-backed loan schemes. In 2021, ethnic minority-led businesses were significantly more likely to be using a Bounce-Back Loan than their counterparts – 34% compared to 22%, respectively.
The latest UK business insurance statistics found that 44% of SMEs in the UK have no commercial insurance – up from 40% in 2021. This amounts to over 2.4 million SMEs in the UK.
A further 40% are thought to be underinsured, meaning their premises and assets are insured for less than their full value. This figure could be as high as 50%, with inflation, extreme weather, and distribution and supply issues in wake of the war in Ukraine expected to have further increased the number of underinsured businesses.
The average cost of public liability insurance in the UK was £118 in 2022, with the average cost of employers’ liability insurance per office employee found to be £61. This rises by more than 200% to £213 for an employee carrying out physical work, such as construction.
The UK insurance industry is the fourth largest in the world and the biggest in Europe, with UK insurers typically paying out at least £22 million per day in business insurance claims. Of these claims, around £7.6 million per day comes from liability claims, with £1.8 million from employers' liability.
Claims paid out in the UK account for 20.5% of the overall total across Europe. Professional Indemnity (PI) claims are the most frequent business claims made in the UK, with over a quarter of claims relating to PI claims such as professional negligence and breach of copyright.
The latest UK business stats found that fire and explosion was the most common cause of loss by value for businesses globally, accounting for nearly a quarter of all instances (24%).
Natural catastrophes were the next most common cause (15%), with the top two most common causes accounting for nearly 40% of the overall total. Natural catastrophes were responsible for 6% more loss-of-value incidents than both faults and aviation crashes, which were the joint-third highest causes (9%).
Find comprehensive advice on how to make a claim on your business insurance in the event of a financial loss.
The latest UK business statistics found that nearly half (47%) of the uninsured businesses in the UK consider themselves too small for insurance. This was the most popular reason cited by respondents as a reason for not acquiring business insurance.
|Reason for not having insurance||Percentage|
|The business is too small||47%|
|I work from home||42%|
|No customers come to my premises||34%|
|There's not much to insure, eg no premises, no vehicles||33%|
A further four in 10 (42%) cited the fact they work from home as a driving factor, with just over a third (34%) reasoning that no customers come to their premises.
Despite cyber-attacks posing threats to businesses of all sizes, the latest UK business statistics found that many SMEs do not protect their business with cyber insurance. Of the different sizes of SMEs, more than half (56%) of medium-sized businesses had invested in cyber insurance, along with 40% of small businesses and just 17% of micro businesses.
Though cybercrime has been traditionally seen as a problem affecting large companies, a recent UK business report found that 96% of all cyber-attacks are directed at SMEs, with the risks for many businesses increasing since they moved more of their operations online during the pandemic.
Recent UK business statistics estimated that the UK professional indemnity insurance market was worth £2.9 billion in 2021 – a rise of 13% from 2020.
Professional indemnity insurance claims are the most frequent cause of claims in the UK, with 26% of the annual total relating to professional indemnity issues like professional negligence, loss of money, breach of copyright, and loss of documentation.
The most likely sectors to have professional indemnity insurance are those considered traditional professions (solicitors, accountants, architects, chartered surveyors, financial advisors, and some healthcare professionals), with these types of employment accounting for between 75% and 80% of the entire professional indemnity insurance market.
Of these professions, legal services are the biggest buyers of professional indemnity insurance, with the solicitor market estimated to be worth around £340 million.
Following the 2016 referendum, data from the Bank of England (BoE) shows that around 45% of businesses rank Brexit as one of their business's top sources of uncertainty.
According to the BoE, businesses with a higher level of Brexit uncertainty have enjoyed less investment growth post-referendum than those with lower Brexit uncertainty.
In May 2021, the BoE asked business members how they thought the UK’s decision to leave the EU had affected investment. Businesses reported that, in 2020, investment was 5.5% lower than it would have otherwise been.
Small businesses across the UK benefited from the Government’s financial support measures. A total of 1.67 million government-guaranteed loans worth £79.3 billion were distributed to organisations throughout the country.
Parliament bulletins also show that 11.7 million employee jobs were furloughed as part of the Coronavirus Job Retention Scheme (CJRS), costing £70 billion.
However, self-employed workers were not given the same level of support as small businesses. Many were not eligible for the CJRS scheme and couldn’t pay their own salaries as a result.
Consequently, the number of people registered as self-employed dropped by 8.6% in 2021 compared to 2020. This was after increasing 93.9% over the previous 20 years.
The UK has the most advanced e-commerce market in Europe and, according to the most recent figures from the ONS, the UK’s e-commerce revenue in 2019 amounted to £693 billion – a sharp increase on the year before.
The UK has the highest number of online shopping users in Europe compared to population. Between 2016 and 2017 alone, e-commerce sales went up by £80 billion.
In 2021, the UK had Europe’s biggest Business to customer (B2C) e-commerce market, with UK consumers spending 254 billion euros on online purchases, roughly twice as much as the French, who came second (123.4 billion euros). As a result, based on internet shopping figures, the average revenue per user was expected to reach £2,490 in 2022.
Comparatively, online B2C sales peaked at £197.1 billion in 2019, up £8.8 billion from 2018 (£188.3 billion). B2B sales didn’t see such a large jump, with sales declining from £166.1 billion in 2018 to £159.3 billion in 2019.
The latest UK online business statistics found that the retail sector is responsible for around 8% of e-commerce sales across all industries in the UK. In the retail sector alone, online sales constituted 25.2% of all sales in February 2023 – 2.7% less than the same month in 2022.
Following consistent rises in market share between 2006 and 2020, the overall percentage is now more than 12% lower than the pandemic peak of 37.8% (January 2021).
In 2020, UK consumers collectively spent 82 billion hours on shopping apps – up 30% from 2019. So it is unsurprising that mobile commerce represented 60% of online retail sales in the UK in 2021 – the highest percentage in Europe. Moreover, 87% of UK households made online purchases in 2020, making this the highest rate in the country in the past 11 years.
The latest UK business statistics found that:
In 2021, clothing was the most bought item online in the UK, accounting for 55% of online shoppers.
This was followed by food deliveries from restaurants (32%), printed books, magazines, and newspapers (29%), and furniture, home accessories, and gardening products (28%).
The least purchased items online were bicycles, mopeds, cars or other vehicles or their spare spares – due partly to the COVID-19 restrictions imposed on consumers in 2020.
In 2020, digital/mobile wallets were a popular payment method used by a third (32%) of consumers who made e-commerce payments. This is a similar story in-store too. Recent credit card statistics found that since the Covid-19 pandemic, 71% of shoppers have replaced cash with card payments to some extent, with nearly half (46%) now paying entirely with a credit or debit card via in-store card payment solutions like a card machine.
In 2022, there were 4.2 million businesses in the services industry, equating to just over three-quarters (76%) of all companies in the UK.
The construction industry makes up 17% of the UK’s business population and is almost entirely populated by SMEs (914,000). A considerable number of SMEs were also operating in the professional and scientific (762,000), and retail sectors (548,000) constituting 14% and 10%, respectively.
|Sector||Number of businesses (thousands)||Percentage of overall businesses|
|Agriculture, mining and utilities||180||3%|
|Accommodation and food||221||4%|
|IT and communications||335||6%|
|Financial and insurance||84||2%|
|Real estate activities||130||2%|
|Professional and scientific||762||14%|
|Administrative and support service||473||9%|
|Health and social work||341||6%|
|Arts and recreation||275||5%|
|Other service activities||355||6%|
(Source: House of Commons Library)
At the other end of the scale, the real estate and financial/insurance industries accounted for the lowest percentage of total UK businesses, with each sector making up 2% of the overall business population.
These sectors were followed by agriculture, mining, and utilities, which accounted for 3% of the total UK businesses.
UK business facts show that, in 2021, approximately one in five (18% of) UK SMEs achieved growth within the previous 12 months. SMEs in the agriculture sector were most likely to grow in 2021, with almost a quarter (23%) of SMEs reporting annual growth across 2020-21.
Agriculture was closely followed by manufacturing and property and business services, with more than a fifth (21%) of SMEs in these sectors reporting growth in 2020-21.
Hotels and restaurants were the only industry in which less than 10% of companies achieved growth, with its total of 8% the lowest total of any sector. Transport and construction were the industries that recorded the next lowest percentages, with 14% and 16% of businesses from these sectors achieving growth, respectively.
The UK sector that employs the largest number of people is wholesale and retail trade. This industry is responsible for almost a fifth (18%) of the UK’s workforce, with 46% of its employees working for small or medium-sized businesses, according to recent UK business facts.
The industry employing the lowest number of people in the UK was mining, energy supply, and waste management, with only 390,000 UK workers employed in this sector. This number represents around 1.4% of the overall workforce in the UK.
The next lowest industry for employment was agriculture, forestry, and fishing with its 487,000 employees accounting for 1.8% of UK jobs.
The latest UK business stats found that around half of the industries in the UK managed to grow their business population in 2022. Notably, businesses in the information and communication sector fell by 17,000 (8%) due to rising input prices and the rising cost of living.
However, construction, accommodation and food services, and property grew by 15,000 (4%), 8,000 (5%), and 6,000 (6%), respectively.
|Industry||Total businesses (to the nearest thousand) in 2021||Percentage of total business in 2021||Total businesses (to the nearest thousand) in 2022||Percentage of total business in 2022|
|Agriculture, forestry and fishing||141||5.10%||143||5.10%|
|Mining, quarrying and utilities||15||0.60%||16||0.60%|
|Wholesale and retail; repair of motor vehicles||406||14.70%||414||15%|
|Transport and storage (inc. postal)||138||5%||138||5%|
|Accommodation and food services||167||6%||175||6.30%|
|Information and communication||213||7.70%||196||7.10%|
|Finance and insurance||61||2.20%||60||2.20%|
|Professional, scientific and technical||453||16.40%||431||15.60%|
|Business administration and support services||230||8.30%||229||8.30%|
|Public administration and defence||8||0.30%||8||0.30%|
|Arts, entertainment, recreation and other services||177||6.40%||181||6.50%|
Seven industries did not grow their business population between 2021-22. These were:
Transport and storage
Information and communication
Finance and insurance
Professional, scientific and technical
Business administration and support services
Public administration and defence
The cost of living has been on the rise since early 2021, and inflation reached a 41-year high of 11.1% in October 2022. This had an effect on businesses on the affordability of goods and services. While inflation eased in the following months, it rose again between January 2023 and February 2023 from 10.1% to 10.4%.
We've broken down some ways the cost of living crisis will impact SMEs, and how they can deal with this stressful time.
In Autumn 2021, the Government officially ended its "work from home" guidance. As a result, many people returned to the office, thereby increasing the cost of commercial real estate. This rent increase is likely to have a detrimental impact on many businesses – particularly SMEs – resulting in businesses eating into profitability or forcing them out of business premises altogether.
According to a quarterly poll of over 5,000 businesses by the British Chambers of Commerce (BCC), 60% of businesses expect their prices to rise in Q4 2022 – the highest percentage recorded for any quarter. The survey found that four in five (80%) consider inflation to be a bigger threat than they perceived three months ago, with 36% expecting a decline in profit.
This follows a previous report published by the BCC in early 2022 that found almost three in four (73%) businesses intended to increase prices, alongside 50% seeking to cut costs, and 18% expecting to scale back investment. A further 5% in the same report claimed they were considering ceasing trading altogether.
If you find yourself struggling to keep up with increasing rent, your commercial lease will be subject to a rent review – typically every three to five years. Landlords often adjust the rent based on the open market rental value or Retail Prices Index (RPI). Consider speaking to a specialist advisor to help you negotiate the best terms for you and your business.
Energy prices are always going up and down, but in 2023 significant changes were made in the rates quoted for business electricity and gas. This is partly due to supply issues from Russia, which is pushing up costs for businesses and households across Europe. As a result, energy suppliers are quoting high rates due to record-level wholesale prices (what suppliers pay for energy in bulk).
These rates affect the price everyone pays for their energy because suppliers purchase energy from the wholesale market and sell it to customers. When the prices rise, rates are subsequently increased to cover the extra costs, resulting in higher energy bills.
Unfortunately, there has been no price cap for businesses which means, with the cost of living crisis, businesses have been fearing just how much their energy bills could increase.
However, in September 2022, the Government announced a support package for businesses in the UK, where wholesale gas and electricity prices for firms would be fixed for six months from the beginning of October. For those eligible (companies who had agreed to fixed deals at higher prices on or after 1 April, and those on variable and flexible tariffs), this is said to cut energy bills by around half their expected level.
Under this package, wholesale prices are expected to be fixed for all non-domestic energy customers at £211 per MWh for electricity and £75 per MWh for gas. Comparatively, without this support package, wholesale costs are expected to be around £600 per MWh for electricity and £180 per MWh for gas.
The latest cost of living statistics revealed that those in the health industry were expected to see the most significant increase in their energy bills between 2021-22. Energy bills for this sector were expected to be more than 75% higher in 2022 compared to the previous year. Comparatively, retail was predicted to endure the smallest increases of all sectors in 2022 . However, they can still expect their energy bills to be nearly 60% more expensive than in 2021.
Train fares in England and Wales, including season tickets on commuter routes and off-peak tickets, increased by up to 5.9% in March 2023. This is the biggest price hike in ten years. In Scotland, a further 3.8% rise was imposed on-peak and off-peak regulated fares from 24 January 2023.
What's more, public transport fares in London also increased by an average of 5.9% in March 2023.
Those driving to work have had to deal with increased fuel prices too, which reached an all-time high in 2022. After this peak, which saw petrol and diesel prices exceed £1.90 per litre in July 2022, prices have steadily reduced in 2023 to an average of around £1.48 per litre.
Rising fuel costs are not a problem exclusive to employees. Fuel is a major expense for small businesses and can impact supplies, deliveries, and overheads. This affects how businesses price their products and services too – particularly when suppliers pass on their costs to clients.
As part of Jeremy Hunt’s Autumn Budget 2022, it was announced that the National Living Wage would be increasing 9.7%, from £9.50 to £10.42 an hour from April 2023, meaning full-time workers will make an extra £1,600 a year.
Prior to this, in the 2022 Spring Statement, Rishi Sunak announced the Government would be increasing Employment Allowance from £4,000 to £5,000 to tackle rising inflation, which is expected to benefit half a million small businesses in the UK. This change enables small businesses to reduce their employer National Insurance contribution (NIC) bills.
Find out more about the small business Employment Allowance on Gov.uk
The latest UK business statistics show a steady rise in the number of women business owners from 2003-23.
From 1984 (the earliest year on record) to 2003, the number of self-employed women in the UK rose by 40%, from 646,000 to 906,000. From here, the numbers continued to accelerate, exceeding 1 million in January 2007 before rising past 1.5 million in January 2017.
After reaching a peak total of 1.7 million in January 2020, numbers decreased by 15% over the next two years, to just under 1.5 million. The downward trend reversed in January 2023, however, with the number of self-employed women rising to 1.6 million – a 10% increase on the same time the previous year.
While the difference between the number of self-employed men and women in the UK has closed slightly over this period, it remains significant. Though the rise in self-employed men has been substantially slower, the recent total of 2.7 million in January 2023 represents a rise of around 10% from the same time in 2003. As such, there are still 69% more self-employed men in the UK than women.
In addition to the above data, a report by the BVA Group in February 2020 found that 22 per cent of all SMEs are led by women.
The same report also found that women businesses are less likely to be using external finance or trade credit, and are more reluctant to borrow than men. They are also slightly less likely to meet the definition of an ambitious risk-taker than their male counterparts.
Despite the rise in women-led businesses over the years, a recent UK business survey found just under one in five women (18%) had considered starting their own business – 11% lower than the number of men who answered the same (29%).
Of the 82% of women who said they had not considered starting a business, more than a third (35%) of respondents said they had insufficient finances, with a further quarter (24%) feeling that it was too risky.
One in five (20%) respondents claimed they were already running a company, with 15% feeling they lacked the confidence required to run a business.
The latest UK business statistics found that Edinburgh and South East Scotland were the UK regions with the highest percentage of self-employed women. Having a total of 35,000 self-employed women in these areas, women made up 39% of their overall self-employed workforce.
The English areas with the highest percentage of self-employed women were the North of Tyne region, which includes Newcastle upon Tyne, and the West of England, which finished joint-second with percentages of 34.7%, respectively.
Though London’s female self-employed total of 286,000 was by far the highest in the UK, its comparatively higher population and larger work force meant that its overall percentage (33.1%) was only the seventh highest in the UK.
At the other end of the table, the West Midlands Combined Authority had the lowest percentage of female self-employed workers. Despite having 45,000 female self-employed workers – three times more than the region with the next lowest percentage (Swansea Bay Region) – this only accounted for 27.2% of the overall workforce.
Swansea Bay Region (28.9%), Greater Manchester (29.4%), and Tees Valley (29.4%) were the regions with the next lowest percentages - the latter having the lowest overall number of female self-employed workers in the UK (10,000).
The latest UK business report from London Stock Exchange found that AstraZeneca had the highest market cap of any UK company in May 2023, with the pharmaceutical company valued at £186.5 billion.
AstraZenaca was worth 13% more than second-placed Shell (£164.7 billion) and 51% more than HSBC in third place (£123.3 billion). The only other company with a market cap above £100 billion was Unilever (£106.3 billion)
|Company||Market Share (£b)|
|British American Tobacco||£61.2b|
(Source: London Stock Exchange)
40% of the companies in the top 10 belonged to either the fuel industry (Shell and BP) or the pharmaceutical industry (AstraZeneca and GSK). Combined, the two pharmaceutical companies are worth £245.1 billion, with the two fuel companies valued at £250.5 billion.
Recent UK business statistics found that Shell was the UK company that generated the most revenue of any business in 2022. With a total revenue of £218.9 billion, the British fuel company generated 40% more money in 2022 than any other UK company.
Shell was followed in the list by a direct competitor in the fuel industry, with BP generating a total revenue of £139.1 billion. Though its revenue was nearly £90 billion lower than Shell’s, BP’s total revenue was still 48% higher than any other company in the UK. As such, all companies with revenues exceeding £100 billion in the UK were fuel based.
Despite only having the 31st highest market cap in the UK, Tesco recorded the third-highest revenue of all UK companies in 2022 (£67.6 billion). The company’s overall profit margin of £2 billion was relatively low compared to revenue, resulting in a lower share price.
There were three banks in the top 10, with HSBC Holdings (£62 billion), Aviva (£51.6 billion), and Lloyds (£47 billion) finishing fourth, fifth, and ninth, respectively. Combined, these three banks generated £160.6 million in revenue.
Whether you want to start a business or you're already running one, our business finance team have written a whole range of guides to help with managing your business' money.
Celebrate diversity in business with our statistics on women in business, ethnic minorities, and more.Read More
As of October 2022, there were around 5.5 million private sector businesses in the UK. 1.4 million of these have employees and 4.1 million have no employees (in other words, were self-employed).
The latest UK business report found that approximately 20% of UK businesses fail in the first year.
The biggest business sector in the UK is the services industry. In 2022, there were 4.2 million businesses in the services industry, equating to just over three-quarters (76%) of all companies in the UK.
The most recent UK business statistics found that around 60% of start-up businesses will fail within the first three years of trading.
The latest UK business statistics found that AstraZenaca is the biggest UK business in terms of market cap, with an overall value of £186.5 billion, as of May 2023.
Shell is the company with the highest overall revenue, with earnings of £218.9 billion in 2022.
The cost of business insurance can vary substantially depending on the size of your business, the industry, and the type of risks involved for employees during their day-to-day work.
The average cost of public liability insurance in the UK was found to be £118 in 2022, with the average cost of employers’ liability insurance per office employee found to be £61. This increases to £213 for an employee carrying out physical work, such as construction.
The latest UK business statistics found that there were around 1.6 million female-owned businesses in the UK as of January 2023 – a rise of 76% from the same time 20 years ago.
According to the Government’s UK SME definition, a small to medium enterprise (or SME), is any organisation that has fewer than 250 employees and a turnover of less than €50 million. SMEs are divided into three categories: micro (less than 10 employees), small (between 10 and 49 employees), and medium (between 50 and 249 employees).
Alumni is a graduate or former student of a particular school, university, or college.
Average annual growth rate refers to the average annualised return of an investment, asset, or portfolio over time. Usually, the average annual growth rate compares the financial growth of a specific month against the figures of that same month one year before, to see how growth has increased or decreased over 12 months.
The Bounce Back Loan Scheme is a now defunct government scheme that helped small and medium-sized businesses to borrow between £2,000 and £50,000, at a low-interest rate, during the COVID-19 pandemic.
Business-to-business (B2B) sales refers to the sales of goods or services from one business to another business.
Business-to-customer (B2C) sales refers to the sales of goods or services from a business to a member of the general public.
A buy-to-let incorporation is a company set up to monitor the profit and taxes on a buy-to-let property, or collection of properties.
A buy-to-let mortgage is a mortgage bought by people for the purposes of renting out a property, rather than living in it.
Commercial insurance is taken out by a business to cover the value of assets, premises, or finances in the event of an accident or adverse event.
A commercial loan is a form of debt-based funding in which a bank, or financial institution, lends money to a business.
The Coronavirus Business Interruption Loan Scheme is a now defunct scheme that helped small and medium-sized businesses access loans and other kinds of finance up to £5 million during the COVID-19 pandemic. In the scheme, the Government guaranteed 80% of the finance to the lender and paid interest and any fees for the first 12 months.
A cost of living crisis is a situation in which the cost of everyday essentials like food and energy is rising much faster than average household incomes.
Cyber insurance is a type of commercial insurance designed to protect businesses from the financial effects of internet-based risks like data breaches or malicious cyber hacks.
In business terms, a founder is a person who starts up their own business.
Gross lending is the total amount of credits issued to banks during a specific accounting period.
A limited company is a business owned by its members. There is limited liability, which means the company’s finances are separate from the personal finances of its owners, and creditors may only pursue the company’s assets to settle a debt.
A sole proprietorship is an unincorporated business with only one owner who pays personal income tax on profits earned.
Liquidation is the process of permanently closing a business and distributing its assets to claimants.
Market cap is the total market value of a company's outstanding shares of stock.
An ordinary partnership is one that is business owned or run by two or more people. No formal agreement is necessary, and partners share risks, costs and liabilities.
A private sector business refers to any for-profit business run by an individual or company that is not controlled by the state.
Public liability insurance is a type of commercial insurance that covers injuries and damage claims brought against a business by a third party.
Professional indemnity insurance is a type of commercial insurance that covers a business against claims made by clients or third parties as a result of the impact of negligent services provided or negligent advice given.
James has spent the past 15 years writing and editing personal finance news, specialising in consumer rights, pensions, insurance, property and investments - picking up a series of awards for his journalism along the way.