SMALL and medium-sized businesses in the UK have faced a “tumultuous” time since the Brexit vote in June, a survey by insurer Zurich has concluded.
The survey highlights particular fears among small and medium-sized enterprises (SMEs) about risks to international trade, and the plunge in the pound arising from the UK electorate’s June 23 vote to leave the European Union.
Less than three months on from the vote, 22 per cent of SMEs declared that the drop in the value of sterling had already hindered their businesses, according to the survey of more than 1,000 firms. Meanwhile, 57 per cent of SMEs expressed concern about the effect of the UK’s withdrawal from the EU on foreign currency and exchange rates. Nearly half of firms expressed worries about future import and export conditions.
Meanwhile, 44 per cent said international trade risks, including sanctions and regulation, were a key concern for them.
Zurich said: “Statistics suggest, above all else, SMEs crave certainty in the business environment, following the decision to Leave.”
Of SME owners and decision makers surveyed, 54 per cent declared they had voted to remain in the EU, while 43 per cent revealed they had voted to Leave.
The survey shows, if they were asked to vote in the EU referendum again, 55 per cent would opt to stay.
Notwithstanding this continuing majority of SME owners and decision makers in favour of remaining in the EU, 52 per cent of firms surveyed said they opposed calls for a second referendum on membership.
One-quarter of SMEs believed the appointment of Theresa May as Prime Minister would have a positive impact on their businesses, while eight per cent thought it would have a negative effect.
Anne Griffiths, head of SME proposition at Zurich, said: “Statistics suggest a worrying uplift in concern about business risk among SMEs, which hit two-year highs earlier this year. While business conditions remain uncertain, it is vital that the interests of UK SMEs remain represented on the world stage, and that British business leaders receive the support they need to continue to function as the backbone of the UK economy.”
Sterling was driven down to a five-week low yesterday by worries over the political and economic risks arising from the UK’s impending exit from the EU.
The pound traded below $1.2950 during the session.
A survey published on Monday by financial services company Close Brothers showed 38 per cent of the UK’s SME owners anticipated that the decision to leave the EU would lead to the break-up of the UK.
In Scotland, 51 per cent of SME owners believed that the Brexit vote would lead to a break-up of the UK. In Greater London, 52 per cent of SME owners held such a view. In East Anglia, only 21 per cent believed the Brexit vote would lead to a break-up of the UK.
Neil Davies, chief executive of Close Brothers Asset Finance, said: “The UK’s decision to leave the EU has made business owners confront a number of issues that perhaps they did not actively consider before.
“Over 60 per cent of those surveyed feel that the union will survive intact, but there are, as one would expect, strong variations.”
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