ÌÇÐÄÆƽâ°æ

There were around **** million private sector businesses operating in the United Kingdom in 2025, with ** of these being construction businesses and a further ***professional, scientific, and technical businesses. The overall number of businesses in the UK reached a peak of **** million in 2020, but fell quite sharply to **** million following the COVID-19 pandemic. 

UK business confidence muted in 2025

Several metrics suggest UK businesses are operating in a tough environment in 2025. Business confidence has generally declined since 2022, with many firms pointing to an increased tax burden as one of their main challenges. Inflation remains a major concern too, with elevated prices remaining in place from the inflation crisis, and expected to rise further in 2025. This challenging environment may also cause firms to think twice when it comes to hiring, with the UK labor market starting to show signs of this happening already.

Labor market cooldown well underway

A survey from Spring 2025 that asked businesses about their employment intentions revealed that ** percent of firms intended to reduce their staff levels, the highest share in that survey since 2020. The number of job vacancies in the UK has also continued to fall, with just ** in June 2025. This was the fewest number of vacancies since April 2021, and outside the pandemic, the lowest since May 2015. The number of employees on UK payrolls has also declined recently, with the pace of this reduction accelerating since the start of the year.