"FSB's Small Business Index (SBI) for Q3 shows overwhelming pessimism among small firms in the London region, with a headline confidence reading of -46 points. The proportion of small firms in the London region are bracing for contraction, be it downsizing, closure, or a sale, in the next 12 months has risen to 30% per cent."
"FSB is urging the Chancellor, Rachel Reeves, to heed this stark warning and to take dramatic action in next month's Budget to ease the small business rates burden and the impact of increasing employment costs, and to lower the sky-high tax levels on entrepreneurship. Among the UK small business community, the factor driving this pessimism around growth was predominantly the domestic economy, cited by over two-thirds of small firms (68%), followed by the tax burden (45%), labour costs (34%), and then consumer demand (28%)."
Small business confidence in the London region fell to -46 in Q3 2025 while national confidence dropped to -58, down from -44 in Q2. Thirty percent of London small firms expect contraction in the next 12 months and only 26% expect growth; nationally 18% expect growth and 30% expect contraction. Six percent of UK small firms predict closure within a year, up from 4% in Q2, equating to more than 330,000 potential closures. Revenue trends were weak, with 17% of London firms reporting rising revenues and 60% reporting falls. Primary drivers of pessimism were the domestic economy (68%), tax burden (45%), labour costs (34%), and consumer demand (28%).
Read at London Business News | Londonlovesbusiness.com
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