By Angharad Carrick,Editor
Copyright dailymail
The majority of small businesses report being concerned about their future, blaming tax rises and financial uncertainty for worsening conditions. A survey by NFU Mutual found that 7 in 10 sole traders and microbusinesses, which employ fewer than 10 people, say they are concerned about the short-term future of their business.
A high cost of living , which has a knock-on effect on prices and consumer confidence, is the biggest threat to 35 per cent of businesses, followed by inflation (32 per cent) and the National Insurance increase (19 per cent). Last autumn, Rachel Reeves hiked employer NICs from 13.8 per cent to 15 per cent in April, making it more expensive for companies to hire.
NFU’s survey found that tax rises were the biggest challenge for small businesses, with 30 per cent expressing concern, followed by the cost of goods and materials (27 per cent), and low consumer confidence (24 per cent). Other threats included artificial intelligence , global politics and struggling to hire staff.
Young business owners aged between 25 and 34 are most anxious, with 85 per cent reporting they were concerned or had some concern, followed by 72 per cent of 35-44 year olds. But despite a challenging backdrop, 25-34 year olds were the most confident about their business’s potential for growth in 2026 (95 per cent), much higher than the average 50 per cent of businesses that said they were confident of growth over the next five years.
Almost half of small businesses said their revenue had increased compared to last year, with just 16 per cent saying it had decreased. Zoe Knight, head of commercial at NFU Mutual, said: ‘We champion the small businesses within our communities and, while it’s worrying to see the numbers concerned about their short-term future, what is heartening is that three-quarters of those surveyed are confident about the potential for growth within 2026.
#Sole traders and small businesses regularly face a multitude of challenges in their daily operations – but are often the cornerstones of their local areas – so it’s important to support them where possible.’ The industries most affected were science, technology and research (85 per cent), and engineering, manufacturing and construction (70 per cent). The survey found 65 per cent of small retail businesses had concerns about the short-term future.
Bigger businesses have also raised the alarm over the £7billion increase in costs following last year’s Budget. Companies are struggling to cope with the National Insurance hike, which has made it more expensive to hire workers, resulting in fewer jobs and costs being passed on to customers.
Business leaders are urging the Chancellor not to raise taxes for businesses again in the Budget. The British Chambers of Commerce (BCC) and Confederation of British Industry (CBI) have called on Reeves to get behind business, while T esco boss Ken Murphy said ‘enough is enough’.
