SMEs should contribute £241bn to the UK economy by 2025.
So says a new study from specialist challenger bank Hampshire Trust Bank.
The figures come from a research project, conducted annually and in partnership with the Centre for Economics and Business Research (CEBR), which revealed that SME contributions to the economy will grow by 19% from 2016 to 2025.
The report went on to say that currently contribute £202bn to the economy, with the vast majority of this value originating from companies in London. However, SMEs in Leeds and Greater Manchester are set to boost their contribution the most by 2025, with 26% growth expected in both cities in the 2016 – 2025 period. Bristol follows closely behind, predicted to increase its SME contribution by almost a quarter (23%).
Top 10 UK cities by SME contribution to the UK economy
| City | 2016 contribution | 2025 contribution | % change
2016 – 2025 |
| Greater Manchester | £13bn (£13,373,718,500) | £17bn (£16,835,047,500) | 26% |
| Leeds | £5bn (£5,435,544,700) | £7bn (£6,844,605,500) | 26% |
| Bristol | £4bn (£3,839,627,800) | £5bn (£4,741,697,300) | 23% |
| London | £152bn (£152,164,339,800) | £181bn (£180,972,040,900) | 19% |
| Tyneside | £5bn (£5,187,149,100) | £6bn (£6,170,773,300) | 19% |
| Birmingham | £6bn (£6,426,096,700) | £8bn (£7,612,653,900) | 18% |
| Edinburgh | £4bn (£4,450,399,200) | £5bn (£5,253,973,100) | 18% |
| Glasgow | £5bn (£5,157,719,900) | £6bn (£6,103,088,100) | 18% |
| Cardiff | £3bn (£2,602,141,500) | £3bn (£3,007,878,100) | 16% |
| Sheffield | £3bn (£3,457,445,600) | £4bn (£3,933,334,100) | 14% |
| TOTAL | £202bn (£202,094,182,800) | £241bn (£241,475,091,800) | 19% |
2020 – 2025 forecast contribution of SMEs to the UK economy
| City | 2020 forecast | 2025 forecast | % change
2020 – 2025 |
| Greater Manchester | £15bn (£14,922,863,500) | £17bn (£16,835,047,500) | 13% |
| Leeds | £6bn (£6,086,833,500) | £7bn (£6,844,605,500) | 12% |
| Bristol | £4bn (£4,270,657,600) | £5bn (£4,741,697,300) | 11% |
| London | £165bn (£164,742,230,500) | £181bn (£180,972,040,900) | 10% |
| Tyneside | £6bn (£5,616,350,800) | £6bn (£6,170,773,300) | 10% |
| Glasgow | £6bn (£5,567,410,000) | £6bn (£6,103,088,100) | 10% |
| Birmingham | £7bn (£6,996,821,900) | £8bn (£7,612,653,900) | 9% |
| Edinburgh | £5bn (£4,798,870,100) | £5bn (£5,253,973,100) | 9% |
| Cardiff | £3bn (£2,794,497,700) | £3bn (£3,007,878,100) | 8% |
| Sheffield | £4bn (£3,683,553,900) | £4bn (£3,933,334,100) | 7% |
| TOTAL | £219bn (£219,480,089,500) | £241bn (£241,475,091,800) | 10% |
Chief Executive at Hampshire Trust Bank Mark Sismey-Durrant said: “SMEs are forecast to grow their economic contribution significantly over the longer-term, which serves as a critical reminder of the important role these businesses play in ensuring the success of the UK. We also should note from our study the lowering in confidence amongst some SMEs. If the UK is to be prosperous as we move away from the European Union, we need the government to keep the spotlight on smaller companies by creating conditions which will support their continued growth, as our research demonstrates how much we need these companies to develop and achieve their ambitions.”
Nina Skero, Managing Economist at CEBR, added: “This study demonstrates how SMEs are making a vital contribution to city economies across the UK. The importance of SMEs is on the rise, therefore we hope this research will boost confidence among business leaders in the UK so they may continue to support job creation and capitalise on opportunities for growth.”
