UK business owners have needed to be more resilient than ever over the past year. As the coronavirus pandemic lingers and businesses continue to adapt, there’s hope that this year will finally bring some stability back. To fully understand what lies ahead, we surveyed over 1,000 UK SME owners and senior leaders across 20 sectors. What do they see as the key business challenges for 2022?
Review our findings here.
Biggest challenges faced by businesses in 2022
It’s no surprise that coronavirus restrictions are still the most significant concern for businesses this new year. However, many people will be surprised that environmental and sustainability challenges come a close second with 22%. This highlights just how important green issues are likely to be for UK small businesses in 2022.
Compare these figures with last year’s and one significant difference is clear: much less concern about the impact of Brexit. This has dropped from almost a fifth of answers to just 5%, suggesting that many businesses have acclimatised to the recent changes.
Conversely, societal changes are a rising worry, climbing from sixth to third. Almost twice as many respondents list it as their “biggest concern” for the year ahead.
Top 10 concerns for small businesses in 2022
We asked small businesses to share their top ten concerns across a range of topics. Their top three causes for concern were:
- Lockdowns
- The decline of the high street.
- Keeping up with compliance and regulation.
Let’s take a closer look at some of the hurdles businesses anticipate having to overcome in 2022.
Top 10 concerns for small businesses in 2022
Interestingly, energy and utilities is the sector most concerned about the impact of further lockdowns on their business (74% are worried about this). With energy prices sky-high, the industry has had a turbulent year and many companies have disappeared from the market.
Performing arts businesses (69%), media and internet companies (69%), and marketing, advertising and PR businesses (71%) are also very concerned. The least concerned are IT companies, the insurance and pensions industry, and retail although the figures are still high: 55% and 56% respectively.
The marketing, advertising, and PR industry are the most troubled by the pressures of sustainability and green initiatives. Almost half (46%) list it as a concern for 2022.
Staff decisions faced by businesses last year
It’s clear that many SMEs are concerned about how the pandemic and how the possibility of restrictions could impact their business and its people. Worryingly, 19% of small businesses had to let staff members go due to the pandemic. It’s understandable that they are looking for the government to reintroduce support schemes.
I used the furlough scheme during the pandemic and am concerned about restrictions being brought back in without government support
I had to let staff members go due to the pandemic in 2021
I am worried about what support is available if my business stops trading due to coronavirus restrictions
Business outlooks for 2022
Business outlooks for 2022 are more positive than in 2021. Almost a third (32%) of businesses expect to grow this year, compared with only 8% last year.
In addition, the percentage of businesses expecting to make a loss has decreased to just 8%. That’s less than half than the previous year, a strong step in the right direction after an extremely challenging period.
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