BREXIT SENDS A CHILL THROUGH THE BUSINESS WORLD
Small and medium businesses are more worried than ever about the UK’s impending exit from the EU
MORE small and medium businesses than ever say Brexit will be a major obstacle to the success of their company.
A new survey from the Department for Business, Energy and Industrial Strategy reveals that 29 per cent of these enterprises felt this way in 2018.
That is up from 27 per cent the year before and 21 per cent in 2016, when the question was asked for the first time.
Small and medium-sized businesses (SMEs) are those with fewer than 999 employees.
The government estimates there were 5.7 million SMEs in 2018.
For the first time, this year’s survey asked businesses that considered the UK’s exit from the EU as a major obstacle about specific difficulties they had already or were expecting to experience.
More than a third (34 per cent) said they expected to see an increase in the cost of EU imports, and close to a quarter (23 per cent) said the same for EU exports.
More than a fifth of SMEs (21 per cent) expect to see a decrease in investment and 15 per cent expect to struggle to recruit or retain skilled EU labour.
Seven per cent expect to struggle to recruit or retain unskilled EU labour.
Nearly a fifth of businesses (18 per cent) said they expect to face “other” difficulties.
Although we’re yet to leave the EU, a whopping 24 per cent of SMEs who said Brexit will be a major obstacle for their business have already experienced an increase in the cost of EU imports.
More than one in 10 (12 per cent) say they have seen investment decrease.
Of all industries that said Brexit was a major obstacle, the retail sector has fared the worst.
Nearly half (44 per cent) have experienced an increase in the cost of EU imports already.
That was followed by the accommodation and food service (40 per cent), and the manufacturing sector (35 per cent).
Mike Cherry, National Chairman from the Federation of Small Businesses, said: “A large proportion of our small businesses were desperately unprepared or ready for a no deal Brexit back then and are in this same position now. “Others went and spent time and money preparing for this outcome for it to be postponed.
“These businesses were put at a significant competitive disadvantage after they changed the way they do business or started stockpiling in preparation for no deal. “Small businesses have been brought to the cliff-edge of a no deal Brexit at the end of March and are now being led there again.”