Small business concerns over economic uncertainty have sky-rocketed over the last 12 months by almost 50%, according to new research from Novuna Business Finance. The latest tracking data from its Business Barometer study revealed the percentage of small business owners worried about market volatility has risen from 27% in Q1 2022 to 40% this quarter – becoming the number one concern in small businesses, replacing the long-term economic impact of Covid as their top worry.

With the headline inflation figure falling to 10.1% last month  – Novuna’s quarterly poll of 1,106 small business owners suggested that 79% of small business owners were kept awake by issues that were a major source of worry.  

Along with the legacy of Covid, the long-term impact of Brexit had fallen as a worry since this time last year (18%). Instead, concern has risen on the financial aspects of running a business – such as; managing cash flow (19%), retaining business (21%) and the prospect of rising tax and interest rates (22%).

Pressure points: Manufacturing and retail 

By sector, the story was more varied. Nine in ten small business owners in the manufacturing and retail sector were tossing and turning at night over pressing business concerns (91%), compared to three quarters nationally (79%). This was a drastic increase on this time last year, catapulting from 78% to 91% in manufacturing and 76% to 91% in retail. 

When it came to the specific concerns that were keeping these business leaders awake at night, the continuing impact of Brexit remained a significant worry for those in the manufacturing sector, with almost two fifths of businesses citing it as a key business concern (34%). This was almost three times the number of construction businesses with the same concern (12%). 

In retail, the uncertainty of economic volatility was a much bigger issue than it was nationally, with 57% of small businesses in this sector expressing significant concerns, (compared to 40% nationally).

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There was a slightly more positive story when it came to business owners in Media and Marketing and Agriculture, who were significantly less worried this quarter compared to last year (88% to 79% and 85% to 79% respectively). However, this still represented three quarters of small businesses in these sectors with considerable concerns surrounding their business.

Regionally, the research revealed a significant rise in concern amongst those businesses in Wales (72% to 86%), Yorkshire (77% to 85%) and the South East (69% to 78%), with Welsh enterprises becoming those most likely to have concerns about their business. Conversely, there was a slight fall in the percentage of Scottish business leaders that said business worried kept them awake at night (falling from 79% to 75%).

Jo Morris, Head of Insight at Novuna Business Finance comments: “In recent weeks, there have been some positive indications on UK economic outlook for the year ahead. That said, the majority of small business owners are still juggling worries and uncertainties – and many are taking their worries home with them after work. From Brexit to Covid to the cost of living crisis, small businesses have had to react to a succession of challenges. Many have done well, with our data suggesting growth forecasts have remained bullish – but this need to endlessly adapt has seemingly taken its toll on business owners.

“Despite the results revealing a picture of volatility, the one thing small business owners can be certain on, is uncertainty – and the hard reality it that is almost becoming the new normal.”

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