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Small Business Statistics UK 2025
According to the Department for Business and Trade statistics, small businesses make up more than 99% of the business population. How many small businesses are there in the UK, how long do they survive, what's their turnover and which industries are most popular? Answers to these questions and more in our analysis of business demographic statistics from the Department for Business and Trade and the Office for National Statistics.
- How many small businesses are in the UK?
- Most popular small businesses in the UK
- Small business turnover
- Employee costs
- Births and deaths
Over 5.4 million small businesses in the UK employed 12,961,000 people and brought in £1,825,722,000,000 (over £1.8 trillion) in turnover last year. Here's how that breaks down.
Number of Businesses in the UK
In 2024 there were 5,498,990 businesses in the UK, of which 5,452,990 are considered "small businesses". Small businesses account for 99.2% of the total business population. Of small businesses, 4,071,825 businesses (or 74% of small businesses) had no employees—these are sole proprietorships and partnerships with only the self-employed owner-manager(s) and companies with a single employee who is also a director. The other 1,381,165 small businesses had at least one employee.
| Number of Small Businesses in the UK, 2024 | |
|---|---|
| With no employees (not registered for VAT or PAYE) | 2,870,855 |
| With no employees (registered for VAT or PAYE) | 1,200,970 |
| 1 employee | 124,220 |
| 2-4 employees | 770,185 |
| 5-9 employees | 266,860 |
| 10-19 employees | 141,900 |
| 20-49 employees | 78,000 |
| Total number of small businesses | 5,452,990 |
| Number of larger businesses (50+ employees) | 46,000 |
| Number of all businesses (small, medium and large) | 5,498,990 |
Small Business Growth Statistics
The number of small businesses in the UK grew 40% in the past 20 years from 3,890,700 in 2004 to 5,453,100 at the end of 2024; but dropped 8% from 2020 to 2022 due to effects of the pandemic (-6.6% in 2021 and another -1.5% in 2022). On average over the past 20 years, annual growth in the small business population has averaged around 2% per year. The year with the highest increase was 2014, when the number of small businesses grew 6.8%.
| Small Business Growth Statistics | Businesses with no employees | Businesses with 1 - 49 employees | Total Number of Small Businesses | Year-on-Year Growth |
|---|---|---|---|---|
| 2004 | 2,763,000 | 1,127,700 | 3,890,700 | 6.84% |
| 2005 | 2,752,000 | 1,140,200 | 3,892,200 | 0.04% |
| 2006 | 2,930,500 | 1,159,500 | 4,090,000 | 5.08% |
| 2007 | 3,047,200 | 1,188,800 | 4,236,000 | 3.57% |
| 2008 | 3,045,500 | 1,202,400 | 4,247,900 | 0.28% |
| 2009 | 3,137,800 | 1,201,200 | 4,339,000 | 2.14% |
| 2010 | 3,258,600 | 1,188,900 | 4,447,500 | 2.50% |
| 2011 | 3,377,400 | 1,174,300 | 4,551,700 | 2.34% |
| 2012 | 3,581,100 | 1,200,700 | 4,781,800 | 5.06% |
| 2013 | 3,703,600 | 1,173,700 | 4,877,300 | 2.00% |
| 2014 | 3,969,600 | 1,239,100 | 5,208,700 | 6.79% |
| 2015 | 4,089,300 | 1,272,400 | 5,361,700 | 2.94% |
| 2016 | 4,172,500 | 1,284,900 | 5,457,400 | 1.78% |
| 2017 | 4,327,700 | 1,325,700 | 5,653,400 | 3.59% |
| 2018 | 4,278,200 | 1,346,900 | 5,625,100 | -0.50% |
| 2019 | 4,457,900 | 1,366,600 | 5,824,500 | 3.54% |
| 2020 | 4,567,800 | 1,368,700 | 5,936,500 | 1.92% |
| 2021 | 4,175,000 | 1,372,800 | 5,547,800 | -6.55% |
| 2022 | 4,061,000 | 1,404,300 | 5,465,300 | -1.49% |
| 2023 | 4,110,100 | 1,400,100 | 5,510,200 | 0.82% |
| 2024 | 4,071,900 | 1,381,200 | 5,453,100 | -1.04% |
The growth in the UK small business population was driven by a 47% increase in very small businesses that have no employees in the past 20 years, as you can see in the chart below. But, you can also see that it's the small businesses with no employees that were hit hardest by the pandemic.
Small Businesses by UK Region
Not surprisingly, London has more small businesses than any other area of the UK—974,059 in 2024, which is 20% higher than the figure from 2012. The South East came in 2nd with 900,676 small businesses, representing growth of 18% from 2012.
The area with the best growth in small businesses over the past 12 years is the North West, which all created 26% more businesses over the 2012 to 2024 time period.
| Number of Small Businesses by UK Region | 2012 | 2024 | 12-Year Change |
|---|---|---|---|
| London | 814,600 | 974,059 | 20% |
| South East | 766,300 | 900,676 | 18% |
| South West | 475,500 | 530,135 | 11% |
| East of England | 504,000 | 523,791 | 4% |
| North West | 433,800 | 490,283 | 13% |
| West Midlands | 370,600 | 428,152 | 16% |
| Yorkshire and the Humber | 340,000 | 384,850 | 13% |
| East Midlands | 322,300 | 354,421 | 10% |
| Scotland | 316,400 | 351,790 | 11% |
| Wales | 193,700 | 218,438 | 13% |
| North East | 131,100 | 164,811 | 26% |
| Northern Ireland | 113,600 | 131,917 | 16% |
| England | 4,158,000 | 4,752,355 | 14% |
Most Popular Small Business Industries
If we consider very small businesses that are essentially run by the business owner(s) and no one else—e.g., a sole trader, partnership or limited company with only the director(s) working for the businesses—then construction businesses are the most common.
The most popular type of small business with employees falls into the motor vehicle trade and repair category.
Small Business Turnover
The average small business in the UK reported turnover of £334,811 a year in 2024, but results varied significantly by size of the business. Businesses with no employees reported an average turnover of £89,889 per year—this figure reflects revenues (aka sales) and does not reflect the business costs such as cost of materials, employment costs, small business insurance, marketing, rent and other costs required to run the company.
Micro companies with 1-9 employees reported an average turnover of £584,834 per year, while small businesses with 10 or more employees raked in an average of £3,549,627 in 2024.
How much do small businesses earn a year?
| Business size | Number of Businesses | Total turnover excl VAT (millions) | Average turnover per business |
|---|---|---|---|
| With no employees | 4,071,825 | £366,012 | £89,889 |
| 1-9 employees | 1,161,265 | £679,147 | £584,834 |
| 10-49 employees | 219,900 | £780,563 | £3,549,627 |
| All small businesses | 5,452,990 | £1,825,722 | £334,811 |
Small Business Employee Costs
How much do small businesses spend on employment costs? The average employment cost for a small business was £170,745 in 2024. Micro businesses with 1-9 employees spent an average of £84,608 annually on staff, while small businesses with 10-49 employees spent an average of £625,625 per year on employment costs.
How much do small businesses spend on employees a year?
| Business size | Number of businesses | Total employment costs (thousands) | Average employment costs per business |
|---|---|---|---|
| With no employees | 4,071,825 | n/a | n/a |
| 1-9 employees | 1,161,265 | £98,252,000 | £84,608 |
| 10-49 employees | 219,900 | £137,575,000 | £625,625 |
| Average across small businesses that employ staff | 1,381,165 | £235,827,000 | £170,745 |
Small Business Birth and Death Rates
How many small businesses open each year?
Just over 316,000 businesses opened in the UK in 2023.
How many small businesses close each year?
In total, 309,290 business deaths were recorded in the UK in 2023.
FAQs
According to the UK government, a small business is defined as a business with under 50 employees and turnover under €10 million. However, if we're talking about annual accounts for limited companies, the UK government defines a "small" limited company as meeting any two of the following three criteria:
- a turnover of £10.2 million or less
- £5.1 million or less on its balance sheet
- 50 employees or less
There were 5,452,990 small businesses in the UK heading into 2025, 74% of which had no employees.
Around 300,000+ small businesses open each year in the UK. The vast majority (~97%) of these were births of micro businesses with between 0 and 9 employees. That said, ~7,000 businesses open that employ between 10 and 49 people.
Micro businesses are generally defined as having up to 9 employees. A micro-business is sometimes defined as having less than 10 employees and turnover under €2 million. However, if we're talking about annual accounts for limited companies, the UK government defines a "micro-entity" limited company as meeting any two of the following three criteria:
- a turnover of £632,000 or less
- £316,000 or less on its balance sheet
- 10 employees or less
Methodology
To arrive at the figures in this study, we analysed data from the Department for Business and Trade (DBT) business population estimates, as well as other business demographic datasets sourced from the Office for National Statistics.