A third (30%) of SME business owners believe that the UK will apply to rejoin the EU in the future, new research from FreeAgent, the cloud accounting provider for small businesses, freelancers and contractors, revealed today.
Younger business owners are significantly more likely to believe that the UK will re-apply in the future. Nearly half (47%) of 18-34-year-olds SME owners believe the UK would re-apply to re-join the European Union – these younger entrepreneurs are twice more likely to hold this opinion than business owners aged 55 and over (23%).
The younger age group were also significantly more likely to say that they hoped it would take place with nearly 2 in 5 respondents in favour of rejoining (38%); versus 23% of 35-54-year-olds; and 22% of business owners aged 55+.
Although some remain hopeful for re-entrance, the survey also revealed that 35% of respondents said they believe the UK will never reapply and will stay completely separate from the EU going forward. However, 16% said they think the UK will apply to join the Single Market and or Customs Union in the future.
The findings also demonstrated a gender divide, with male business owners most likely to be of the opinion that the UK will not apply to rejoin the EU – 58% compared to 44% of their female counterparts.
The current state of UK SMEs
Despite the challenges of the last 18 months including the impact of COVID-19 and Brexit, the majority (55%) of SME business owners aren’t worried about the future of their business, the primary reason being 67% of business owners deemed their businesses currently “stable”. This figure rises to 76% for the oldest group of respondents (aged 55 and over) and to 72% for sole traders.
A fifth (22%) of SMEs are going through a period of growth – this figure doubles for 18-24 year olds (44%) – while a further fifth (19%) said that the Covid-19 pandemic has opened up opportunities for their business.
However, almost half (46%) of those questioned expressed concerns about the future of their business. Unsurprisingly, the Covid-19 pandemic emerged as the main cause for this concern for SMEs and of those, 62% said that their business had suffered as a result of the Covid-19 pandemic. 57% also said that they are worried about the long-term negative impact(s) of the pandemic.
Roan Lavery, CEO and co-founder of FreeAgent said, “Although it’s been nearly two years since the UK left the European Union – and 8 months after the transition period ended – Brexit remains a hugely divisive issue for the SME sector. With a third of small business owners predicting that the UK will eventually reapply to join the European Union, and a further 1 in 6 believing it will apply to join the Single Market or Customs Union, it seems that many are pessimistic about how Brexit is progressing and expect to see a dramatic U-turn at some point in the future.
“What is heartening to see is that, despite the combined impact of Covid-19 and Brexit on the SME sector, a clear majority of people not only say that their business is currently ‘stable’ but also they are not worried about the future. This shows just how resilient small businesses have been in the most challenging of times, which is a testament to their adaptability and tenacity.
“However, it is important that we are not complacent about these survey findings. The SME sector comprises at least 95% of all businesses in the UK and is vitally important for the wider economy, but many businesses are still in desperate need of support. As we enter into a post-Covid and Brexit world filled with new challenges, the government should make it a top priority to help these businesses thrive.”