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Two-thirds of small and medium UK businesses would now vote to remain in the EU after seeing their profits harmed by Brexit, new analysis shows.
A survey of more than 500 importers and exporters found 66 per cent would choose to stay in the bloc, up from 53 per cent who voted that way during the referendum in 2016. The percentage of those who would vote to leave was 29 per cent, down from 32 per cent.
The findings, from research carried out by Critical Research, appear to be a direct response to the fact that costly rising regulations and red tape burdens have harmed the profitability of their businesses.
65 per cent of responders said the increased demands on them to comply with trade regulations have “significantly” affected their overall profits. More than half (56 per cent) said Brexit has directly made their business less-competitive within the context of the global marketplace.
Small and Medium Enterprises (SMEs) in the UK usually have fewer than 250 employees and less than £44m in annual turnover, though there are further criteria relating to balance sheets, wider ownership structures and personnel. Small businesses, with fewer than 50 employees, made up 99.2 per cent of all UK businesses in 2024 – a total of around 5.5m of them which contribute more than an estimated £2 trillion between them in annual turnover.
However, many of those who sell to or buy from abroad have been impacted by regulatory changes since the UK left the EU.
An ensuing report on the figures by Bibby Financial Services suggested Keir Starmer’s reset talks with the EU in May could lead to improved prospects for the UK’s small businesses.
“The recent (May) agreement secured with the EU, which seeks to reduce the red tape and increase the flow of trade, won’t mean a return to the single market but may go some way to addressing the administrative and cost burden for business. Time will tell,” it read.
The same report showed that importers or exporters looking for new partners this year were currently considering China and the US as their top target markets, but 8 per cent of exporters were also looking at each of Germany and France.
Only 5 per cent of importers were targeting those nations, as well as the same figure for Spain, compared to 13 per cent for China and the US.
