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What is the top concern for the UK’s SMEs?

What is the top concern for the UK’s SMEs? | Insurance Business UK

What is the top concern for the UK’s SMEs?

Small and medium-sized companies across the UK are most concerned about the impact of employee mental health and wellbeing, financial uncertainty, and health and safety, on their businesses, numbers from Marsh reveal.

The UK Business Risk Report 2022 collected data from over 1,700 UK businesses with revenues of up to £20 million to explore how circumstances over the past year have affected business risk appetite and the approach to risk management of small and medium-sized businesses.

Nearly half (49%) of respondents identified employee health and wellbeing as a key risk, up from 30% in 2021, when COVID-related risks dominated business risk registers. Health and safety likewise remained a top concern, flagged by one-third (33%) of businesses compared to last year’s 32.6%. Only 18% of businesses disclosed that there were no people-related risks they were ‘most concerned’ about.

More than a third (36%) of respondents identified financial certainty as a key risk to their business, down by 6% from last year’s data, indicating some remaining balance-sheet volatility.

Three of the top emerging risks identified in the report reflected the wider economic climate. Thirty-nine per cent (39%) of businesses cited increased energy costs as being the ‘new risk’ they were most concerned about, while 32% cited inflation and 27% cited staff shortages. Falling short of the top three emerging risks were cyber security, which 23% of respondents still viewed as a pressing issue, and supply chain disruption (18%).

The report noted that businesses were currently navigating a “hugely diverse”, almost unprecedented array of risks, and emphasized the role of resilience in transforming new threats into opportunities for lasting improvement.

“Since the survey was conducted, UK inflation has reached a 40-year high, which will have a profound impact on how these firms operate in the near and longer term,” CEO for corporate and commercial UK Alistair Fraser said. “As new risks emerge and current risks continue to evolve, we urge businesses to review their current insurance arrangements and approach to risk management – to build even greater resilience into their people and operations.”