Small businesses are an essential part of the business landscape, but the recent economic turmoil has threatened their survival. So, what is the current outlook? We explore the latest small business statistics in the UK, including the number of SMEs and how this varies between industries and regions.
We also look at how many new businesses survive the first 5 years, and ways you might improve your chances of success with the best business banking options, among other things.
UK small business statistics: Highlights
99.8% of UK businesses are small or medium-sized enterprises (SMEs).
There are 5.5 million SMEs in the UK.
The average turnover for a UK SME is £501,240.
A quarter (26%) of UK SMEs are based in London and the South East.
SMEs contribute over half (52%) of private sector turnover in the UK.
SMEs account for three-fifths (60%) of employment in the UK.
How many SMEs are there in the UK?
The latest figures show there are 5.5 million small and medium-sized businesses (SMEs) operating in the UK. SMEs make up more than 99% of the total private sector business population, and the number of SMEs has increased over the last decade.
Over the last decade, the number of SMEs peaked at the start of 2020 and has declined slightly since then. This is likely due to increased challenges for UK businesses during the coronavirus pandemic and then the cost of living crisis.
However, SMEs have consistently made up the majority of private sector businesses in terms of numbers over the past decade, making up more than 99% of the total every year since 2013.
What is the average turnover for a small business?
The average turnover for a UK small business (0-49 employees) is £334,800, considering there are 5.5 million small businesses contributing a turnover of £1.8 trillion.
The average turnover for an SME (0-249) is estimated to be £501,240, as there are 5.5 million SMEs in the UK, and they contribute a total of £2.8 trillion in turnover.
What is the difference between SMEs, small businesses and micro businesses?
The term SME refers to any business that is small or medium-sized. This includes the sub-categories of micro-business, small business and medium-sized businesses. Small businesses have 0-49 employees, while medium businesses have 50-249 employees.
Micro-businesses with 0-9 employees make up the majority of the SME population in the UK, with a total of 95.3%. Interestingly, three-quarters (74%) of SMEs are businesses with no employees. This category includes sole traders and partnerships without any other employees.
SMEs contribute over half (52%) of business turnover in the UK and account for three-fifths (60%) of employment in the private sector. UK SME turnover was £2.8 trillion in 2024, and SMEs employed 16.7 million people.
In the last decade, the turnover contributed by SMEs has increased every year except between 2021 and 2022. The number of SMEs also decreased in these years, likely due to the coronavirus pandemic, so it makes sense that the turnover would reduce along with this.
The most popular sector for SMEs is construction, with over 872,000 businesses operating in this area. This is closely followed by professional, scientific and technical activities, with just over 755,000. This represents a decrease compared to 2023.
The sector with the lowest number of UK SMEs is production activities. The UK is not currently known to be a hub for production and is known to have a service-based economy, so it makes sense that a relatively low number of SMEs are operating in this area.
Sector
Number of businesses
Construction
870,185
Professional, Scientific and Technical
754,940
Wholesale and Retail Trade
558,935
Administrative and Support Service
495,275
Other Service activities
367,490
Human Health and Social Work
355,805
Transportation and Storage
312,775
Information and Communication
337,945
Education
298,500
Arts, Entertainment and Recreation
280,405
Manufacturing
246,805
Accommodation and Food
246,805
Agriculture, Forestry and Fishing
147,845
Real estate
142,865
Financial and Insurance
86,140
Production
31,050
A breakdown of UK SMEs by region
Unsurprisingly, the majority of small businesses are based in London and the South East, and these 2 regions combined account for a quarter (26%) of all SMEs in the UK – almost 1.9 million businesses. Northern Ireland has the lowest number of SMEs at just 133,000, closely followed by Wales with 220,000. However, compared to 2023, this represents a slight increase in the presence of SMEs in Northern Ireland and Wales.
In 2023, 15% of SMEs with employees were led by a woman or a majority-female management team. This has slightly decreased compared to the statistics in 2022 and 2021. Moreover, education (32%) and health (39%) remain among the sectors that are largely women-led.
How many minority ethnic group-led SMEs are there?
In 2023, just 7% of SMEs with employees in England were led by someone from a minority ethnic background (MEG) in comparison to the 6% in 2022. However, since 2015, there has not been much change in this figure.
The sectors with the highest percentage of MEG leaders were transport and storage (11%) or administration, education, finance and real state (9%).
Click here for more research. For all media enquiries, please contact –
Matt Mckenna
UK Head of Communications T: +44 20 8191 8806
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Matthew Boyle is a banking and mortgages publisher at Finder. He has a 7-year history of publishing helpful guides to assist consumers in making better decisions. In his spare time, you will find him walking in the Norfolk countryside admiring the local wildlife. See full bio
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Sophie Barber is a senior content marketing manager for Finder in the UK. She has over 5 years experience in writing and publishing clear, concise and informative articles that help consumers make informed decisions. See full bio
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