More than 1.8 million UK jobs could be lost over the next five years, with one in five small business owners struggling to cope with the burden of red tape.
A survey commissioned by the business for sale marketplace, Bizdaq, found that 370,000 small businesses plan to cease trading over the next five years, with each business employing 4.85 people on average.
The research, conducted by Opinium, also found that a further 424,000 small business owners are planning to exit their business in the next five years, with no guarantee that all jobs would be protected. Selling would be the most likely way to protect jobs.
Of the 1.8 million jobs at risk, around 370,000 of those would be in the next 12 months alone, as small businesses begin to cease trading.
According to the survey, small business owners in London are the most likely to cease trading by 2020. 43% of small businesses owners based in London are considering exiting their business, while only 11% of those in East of England are planning to cease trading.
Surprisingly, the revenue of a business had little impact on whether small business owners were planning to cease trading or exit their business.
Sean Mallon, CEO of Bizdaq, said “It is astonishing, given the government’s rhetoric around job creation, that little is being done to preserve the number of jobs at risk within Britain’s small businesses.
“If the government were to make leaving a business easier and promote this as the “norm”, then hard working small business owners could capitalise on their efforts and we could retain over 1.8m jobs – it’s a win-win situation.”
Business owners split on Brexit
It’s clear that business owners remain split on the EU referendum and whether their businesses would benefit from being outside of European Union.
The survey conducted by Opinium shows that 41% of business owners think the UK should stay, while 44% said the UK should leave.
15% remain undecided, however, with only a few months to go before the EU referendum.
According to the survey, business owners in Wales (53%) were most likely to say the UK should remain in the EU, while those in the North West of England were more likely to support leaving (59%).
Businesses with higher revenue were more likely to want to remain. The average revenue of those who want to stay in the UK was £93,000, while those who want to leave have an average revenue of £84,000.
Business owners most likely to want to leave the EU were in the hospitality, construction and professional services industries. Meanwhile, those in education, IT and wholesale were more likely to want to remain.
Sean Mallon said: “It is clear that Britain’s small business owners are relatively undecided as to whether it’s “better the devil you know” and remain in the EU, or whether their business would actually benefit from less EU regulation and more state control.
“It seems the larger the business, the more EU trade they are likely to have and there seems to be a correlation with these companies wanting to remain in the EU.”
More information can be found here: http://www.mybizdaq.com/small-business-closure-report