14 JUN 2022

UK Small Businesses Resilient but “Running on Empty”

LONDON, UK, June 14, 2022 – Small businesses across the UK are ‘running on empty’ according to a survey of 379 business owners by Goldman Sachs 10,000 Small Businesses.

The results of the survey show that as small business owners are beginning to recover from the impact of the COVID-19 pandemic, inflationary pressures and staff shortages present a new set of challenges, threatening their growth trajectory and future. Business owners identified increased wage costs and the fight for talent, staff shortages and rising inflation as the biggest challenges that they are facing.

Staff Shortages
The Great Resignation has had an adverse impact on entrepreneurs. More than half of the businesses surveyed said that they have been negatively impacted by staff shortages since the beginning of the year. Unemployment rates are at a record low of 3.7% according to Goldman Sachs Global Investment Research, yet the difficulty to attract talent remains.

One business owner working in IT recruitment: ‘IT are usually the first to get hit by a downturn and the first to see an increase in an upturn. Currently, we are still hiring, but have noticed that some of our suppliers /competitors operating on job boards have increased their prices by 400%. This is unsustainable, some have left the market, some are retaining staff. We are managing to retain staff, once on board, but recruiting staff is very difficult at present.’

Growth and Inflation
Over 40% of entrepreneurs believe that the economic outlook for small businesses is currently worse than it was at the height of the COVID-19 pandemic. Goldman Sachs Global Investment Research forecasts that growth in the UK will fall to 1.2% in 2023, providing a challenging backdrop for businesses and households.

75% of entrepreneurs said that they have also been negatively impacted by inflation, with a further 66% noting that they think inflation will restrict their ability to grow their businesses in the future, as inflation in the UK has reached a 40 year high. Small businesses across the UK are calling for support from government to help manage rising inflation and energy costs over the next 12 months.

One owner of a manufacturing business for soft drinks has experienced major problems with supply chain inflation: ‘it’s tough with cost increases, lack of availability for CO2, cost increases for glass, increasing transport costs, rise in travel costs, and rising staff costs. The latter is particularly evident in some of our low-wage workers working in low skill jobs.

Despite the current challenges posed by the economic backdrop, 4 out of 5 graduates of the 10,000 Small Businesses program are confident that they remain resilient enough to cope with the current economic environment. Furthermore, 92% of our graduates believe that the Goldman Sachs 10,000 Small Businesses program has helped give them the skills needed to succeed in this current climate.

Charlotte Keenan, head of the Office of Corporate Engagement International at Goldman Sachs, says: “Small businesses are integral to the UK economy and local communities. In a world where there is so much uncertainty, we remain committed to providing entrepreneurs with the necessary skills to navigate the challenges ahead.”


Goldman Sachs
Goldman Sachs is a leading global financial institution that delivers a broad range of financial services across investment banking, securities, investment management and consumer banking to a large and diversified client base that includes corporations, financial institutions, governments and individuals. Founded in 1869, the firm is headquartered in New York and maintains offices in all major financial centers around the world.

Goldman Sachs 10,000 Small Businesses UK
10,000 Small Businesses UK is a comprehensive programme of business development and leadership support for small businesses with high growth potential, designed to help them achieve that potential. Piloted in late 2010 and launched in early 2011, to date, 933 entrepreneurs from across the country have graduated from the programme. The 10,000 Small Businesses UK programme is a partnership between Goldman Sachs, the Goldman Sachs Foundation and leading UK universities. Building on the success of the Goldman Sachs 10,000 Women initiative, which provides a business education to women entrepreneurs in emerging economies, 10,000 Small Businesses first launched in the United States in 2009. To date, 10,000 Small Businesses has reached over 7,600 small businesses across the U.S. and UK.

For more information, visit http://www.goldmansachs.com/citizenship/10000-small-businesses/UK/newsand-events/building-small-businesses.html 

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Media Contacts:
Rahma Jeilani
+44 (0) 20 7774 8427