Small business owners remain divided on whether Brexit will ultimately succeed

Today marks the one year anniversary of the vote that split the nation, almost exactly down the middle.

On the morning of Thursday 23 June 2016, millions of people throughout the UK and Europe woke up to the news that Britain had reversed the decision taken during the mid-1970s to be a part of the European Union (European Economic Community, as it was then) and would instead be operating independently of the EU in the future. For many, this was news that brought great cheer and celebration; others shuffled to work more gloomily.

A year on, and while Article 50 – the starting gun on our two year departure from the EU – has now been triggered, we are not much nearer to knowing exactly how the UK will operate once Brexit has taken place.

But how are our nation’s small businesses feeling? Has the decision taken by the referendum already started impacting the 5.5 million businesses, who account for at least 99 per cent of the businesses in every main industry sector?

AAT took the opportunity to find out. Last week, following on from this year’s General Election, we spoke with 800 small business owners, representing a wide range of industries and sectors. The owners were evenly split over last year’s Brexit vote, with 47 per cent voting Leave, 47 per cent voting Remain, and seven per cent not voting at all. Here’s what they told us.

Brexit impact yet to hit majority of small businesses

In general, the small business owners we spoke to were slightly more positive (22%) than negative (18%) about the current impact of the referendum’s decision on their business. But the vast majority were indifferent. The largest group (42%) said that the decision had made neither a positive nor negative impact, with a further 18 per cent suggesting it had made no impact whatsoever.

Interestingly, our findings threw up a handful of ‘re-Leavers’ – those SME owners who voted Remain but have now changed their minds towards Leave. Of those who voted to remain, 7% say they would now vote leave. By contrast, only 3% of leave voters would now vote remain.

The figures of those who would change their votes are low, but perhaps significant, with one owner telling us: “It is now clear that the EU is falling apart regardless, and the UK is best out of it soonest.” In contrast, one Leaver who would now opt for Remain said: “We weren’t told what would happen if we voted to leave. Now it’s obvious, and I think we would work to change it from the inside.”

Those owners who are currently positive about the outcome of the referendum for their small business told us of their increased optimism and confidence for the future, and how the devaluation of the pound has helped some owners for whom workers may be paid in other currencies. Conversely, the weakness of sterling was viewed as a cause for concern by other business owners, along with a reduction in the ability to recruit talent from the EU for their workforce.

How will Brexit ultimately pan out?

With the negotiation process and the UK’s ultimate exit from the EU set to be concluded by around March 2019, narrowly more SME owners (40%) told us they were optimistic that Brexit would ultimately be a success than those who were pessimistic about its chances (36%). A further 20 per cent said they were neutral about Brexit’s chances, while 5 per cent said they didn’t know.

When it came to thinking about their future business hopes, SME owners were pretty much evenly split. Around a quarter (26%) believed Brexit would ultimately have a positive impact on their business, about the same number as those that felt it would have a negative impact (24%). A further 26 per cent felt Brexit would have neither a positive or negative impact on their small business, while 18 per cent believed it would have no impact whatsoever.

Trust me, I’m a politician

Following this month’s General Election, Prime Minister Theresa May is seen to be the politician small business owners think will most likely act in the best interests of their business (26%). However, in a result that mirrored the Election itself, the gap to Jeremy Corbyn was not huge, with the Labour leader polling 23 per cent of the vote.

Aside from the main two political heavyweights in the United Kingdom, David Davis (7%) and returning Liberal Democrat MP Vince Cable (5%) were viewed as the most supportive of small businesses. But tellingly, nearly a third (28%) of SME owners felt no current leading political figure – and we gave them a list with more than ten options to choose from – would act in their business’ interests.

Brexit remains divisive

So what does this all tell us? Well, clearly the result of the referendum last year remains a divisive issue throughout the UK. Small business owners were almost equal in sharing with us how they view the upcoming EU withdrawal as an opportunity and as a concern.

Hopefully, our small businesses will be well considered in the talks now taking place between representatives of the UK and the EU as to how to negotiate Britain’s exit. Issues including our businesses’ ability to trade, the potential impact of new regulations and policies, and supply of skilled workers are all priorities, while hubs such as Informi will provide small business owners with the advice and support they will require as to what, in reality, Brexit will actually mean.

Adam Harwood is AAT's Media Relations Manager.

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