UK Small Business Demographics
In 2025, 5.7 million private sector businesses were operating in the UK (3.5% more than 2024).
Small businesses (0-49 employees) make up 99.2% of all businesses but only 34% of turnover.
SMEs (0-249 employees) account for 99.9% of all UK businesses but only generated 51.2% of the total turnover (£2.8 trillion) in 2025. The other 48.8% ($2.7 trillion) of total turnover was generated by large businesses (250+ employees).
Overall, SMEs (0–249 employees) provided around 60% of total private sector employment throughout the period, but the trend is flat to slightly declining, driven by the relative gains of large companies.
Number of UK businesses in the private sector and their associated employment, employees and turnover (start of 2025)
| SME Type (employees) | Businesses | Employees (Thousands) | Turnover (£ Billions) |
|---|---|---|---|
| 0 employees | 4,272,535 | 4,664 | 403 |
| Micro (1-9) | 1,150,875 | 4,156 | 701 |
| Small (10-49) | 220,085 | 4,324 | 776 |
| Medium (50-249) | 38,435 | 3,738 | 949 |
| Large (250+) | 8,335 | 11,246 | 2,696 |
| All businesses | 5,690,265 | 28,128 | 5,525 |
Number of UK businesses in the private sector and their associated employment, employees and turnover (start of 2025)
| SME Type (employees) | Businesses | Employees | Turnover |
|---|---|---|---|
| 0 employees | 75.1% | 16.6% | 7.3% |
| Micro (1-9) | 20.2% | 14.8% | 12.7% |
| Small (10-49) | 3.9% | 15.4% | 14.0% |
| Medium (50-249) | 0.7% | 13.3% | 17.2% |
| Large (250+) | 0.1% | 40.0% | 48.8% |
| All businesses | 100% | 100% | 100% |
At the start of 2025, there were still 290,000 fewer businesses than the 2020 pre-pandemic high of 5.98 million, but the trend is now up.Â
The number of private sector businesses in the UK rose by 3.5 % between 2024 and the start of 2025.
Large businesses (250+ employees) employ nearly half (46.7%) of the UK’s total private sector workforce, despite representing just 0.15% of all private sector businesses.Â
Micro businesses (1-9 employees) make up over 81% of UK employer businesses but provide less than 18% of private sector jobs
Non-employing businesses drove the most growth, increasing from 1.3 million to 4.3 million in the space of a year. While those with employees increased by just 8%.
UK Business Population Growth
At the start of 2025, there were 5.69 million private sector businesses, which is still 5% fewer than the prepandemic 2020 high of 5.98 million.
The number of private sector businesses in the UK rose by 3.5 % between 2024 and the start of 2025.
The number of non-employing businesses increased the most in the year to 2025Â (6.1%) but there are still 9% fewer than their 2020 high.Â
There are still fewer businesses with 0-9 employees than in 2020.
The number of large businesses (250+ employees) and increased the most since 2020 (7.5%).
Average Small Business Turnover By Region
The average turnover of businesses in the UK increased to £806K in 2023 an. London’s average turnover per business was 50% higher at £1.2M. Â
The total turnover of private sector businesses in 2023 was £4.48 trillion.Â
The average turnover per employee was £162,751 for the UK as a whole.Â
London has the highest average turnover per employee (£228K) which is about twice as high as businesses in the South West (£119K).Â
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Every region in the UK saw annual average turnover increase in 2023.
The average turnover of businesses in the UK increased 6.9% to £806,381 in 2023.Â
The total turnover of private sector businesses in 2023 was £4.48 trillion.
There was a huge difference in turnover is between London and North East (£1.2 trillion vs £86 billion).
There was a negative correlation between a region’s turnover and its growth rate.
The South East (including London) has the highest average turnover but saw some of the lowest turnover growth.
Meanwhile, regions with relatively low average turnover (Wales, Scotland, Northern Ireland, South West, North East, and Yorkshire) all saw 10%+ turnover growth since 2022.
Average Small Business Turnover By Industry
Arts, Entertainment and Recreation saw their turnover drop another 6% in 2023.
Accommodation and food services saw the largest rise in turnover (26%) indicating a post-pandemic rebound.
Real estate (12.5%) and manufacturing (10.4%) saw significant growth in the number of businesses in 2023.
New Openings & Failure Rate Of Small Businesses
SEISS grants ended in Q3 2021, which was the start of eight consecutive quarters of net business closures.
During these 2 years 94,985 more businesses closed than were created.Â
New business openings remained relatively low in Q3 2023 but there were nearly 10,000 more openings than closures in this period.Â
Business Survival Rates
Just 10% of UK companies are older than 20 years.Â
72% of companies are less than 10 years old. Â
51.3%Â of companies in liquidation are less than 4 years old.Â
The average age of incorporated UK companies is 8.6 years in 2023.
The average age of UK companies fell from 10.7 to 8.6 years from 2000 to 2022. The average age has remained consistently around the 8.5 years mark since 2014.
Business Sentiment
Accommodation and food services businesses are the most pessimistic about future turnover. 36.5% think turnover will fall.
18% of businesses believe turnover will increase, but this is skewed downwards by the number of small businesses, which is the most pessimistic group.
 27% of businesses with 10+ employees expect turnover to rise.
Economic uncertainty and the cost of labour are the biggest concerns for businesses at the start of 2024.
The cost of labour is now a major challenge for 22% of business surveyed compared to 14% in July 2023.
The negative impact of inflation is beginning to decline with only 17% of businesses saying the cost of materials will impact turnover compared to 22% in July 2023.
