A total of 87% of Welsh adults would like to see the UK Government do more to support small businesses in Wales – a rise on 84% two years ago, when Labour won the General Election in July 2024.
The new research comes at a time when tracking data from Novuna Business Finance reveals that the percentage of Welsh small businesses predicting growth has fallen sharply since the Spring (Q2) – from 28% to 20% for the summer months (Q3).
This represents the lowest level for growth forecasts in Wales for 15-months – and is a sharp fall from 32% this time last year. With small business growth forecasts at a low point for July, 34% of Welsh small business owners said they are prioritising managing fixed costs in an attempt to secure future growth. Only 5% are looking to expand into new markets and just 6% plan to hire new staff.
With Welsh small business owner sentiment cautious, Novuna Business Finance also polled 2,000 adults in the last week to get their sense on how important they thought it was for the UK Government to support small businesses in their community. With a new Prime Minister taking office, the poll asked members of the Welsh public what would they like to see the Government do more of to support small businesses.
- Tackling the financial pressures that directly affect small businesses were seen to be an immediate priority. Around a third of Welsh respondents (32%) called for a reduction in business rates – a policy area that is devolved in Wales. 22% said they would like to see a reduction of corporation tax for small businesses. In addition, one in five Welsh people called for a reduction in National Insurance (20%) – following the hike, which 49% of small business owners said would negatively impact their finances and growth outlook.
- Energy costs were another concern. With the UK Government announcing that VAT will be scrapped from household electricity bills in October, 23% of Welsh residents are calling on the Government to give small businesses a cap on energy costs, like consumers receive. The decline of high streets across Wales was of equal concern, with a further 27% of Welsh survey respondents wanting to see major investment from the Government in re-generating the high street.
- The international business landscape was also an area where the public wanted to see substantial change to benefit the small business sector. Around one in four Welsh respondents (23%) wanted to see the Government overturn Brexit and allow the UK to re-join the EU, and 26% called on the UK Government to reduce the red tape small businesses face doing business overseas.
- Looking to the future, 15% of Welsh adults wanted more investment in apprenticeships from the Government, plus a wider rollout of apprenticeship schemes – while 16% thought more training and development programmes would help many small business owners and employees.
Jo Morris, Head of Insight at Novuna Business Finance, said:
“What stands out from our recent research is that small businesses matter to everyone. While our Business Barometer tracks the confidence and growth ambitions of small business owners, our survey of the general public shows just how connected people are to the sector. People deal with small businesses most days, a strong small business sector helps communities work well – and many consumers themselves either run or work for a small business – a sector that accounts for around 47% of total private sector employment.
“There have been a lot of positive messages of hope in recent weeks, on what is possible. We share the view that small businesses are key to UK economic growth, that high streets need investment and that reducing the tax and cost-of-living burden on small businesses will help them to invest in long-term growth, modernisation of equipment and to invest in job creation. Our Business Barometer data reveals a low-point for small business growth forecasts this month but, set against these challenges, 62% of Welsh small businesses are still committed to exploring new ways to secure future growth. With the right help from Government on tackling rising costs and the tax burden, there is hope for the future – and at Novuna Business Finance, we remain committed to supporting established businesses as they plan for the future, helping them invest in long-term opportunities that can drive growth, improve operational efficiency and strengthen cash flow.”
