Leaving the EU: small business owners weigh in

Business news and opinion

18 May 2016

Many businesses support staying in the EU, particularly the larger ones. But what do the country’s small businesses and start ups think?

The general picture appears to be fairly varied: while some are advocating Brexit on flexibility grounds, others are worried about its possible effects on access to finance.

Our latest survey, which looked at the responses of more than 800 small business owners*, revealed equally mixed opinions. It’s the over 45s, however, who are more divided over Brexit, with those aged 34 and under being more likely to believe that staying in the EU will be good for business.

Should I stay or should I go?

Our study revealed a split opinion on the subject of Brexit. 19% of respondents said that leaving the EU would be the political change that would most help their business survive. Conversely, almost exactly the same proportion said that remaining in the EU would be the political decision most likely to benefit their business.

Demographic differences

When respondents’ ages are taken into account, almost one third of 18-24 year olds would actively prefer to remain in the EU. This figure falls to just over one fifth for those in the 25-34 age bracket.

Only 18% of SME owners aged 35-44 believe that staying in the EU is vital for their business’ future. This doesn’t mean that the majority think Brexit is the answer, though – in the same demographic, just 15% cited Brexit as integral to their company’s survival.

Our poll also revealed that those aged between 45 and 54 hold the strongest anti-EU sentiments. Over one fifth believe that Brexit is the most important potential political change that could impact their business, compared to 13% who have the same opinion about staying in the EU.

Government intervention

The majority of small business owners agree on their preferred level of government intervention. 69% of respondents said they want lower taxes and less government involvement in their business, which compares to just over 6% who want higher taxes and more state support.

Many small business owners believe that Brexit could be a means of reducing government influence. A recent open letter signed by over 200 SME bosses said that a vote to leave would afford them the “flexibility and adaptability” their companies needed to survive. Their letter went on to criticise “the EU’s constant diet of unnecessary regulations.”

Access to Finance

Representatives from the Federation of Small Businesses, however, have suggested that SMEs are generally more concerned about staying afloat day-to-day, making access to finance as important as ever. So how could leaving the EU effect this?

Director of the Centre for European Policy Studies, Daniel Gros, told The Guardian that, because an EU exit could make the UK less creditworthy, there could be a longer-term impact on the availability of financing – and this could mean SMEs paying more to access credit.

It’s clear from our survey that opinions are still fairly divided on the vote – and small business owners have until the 23rd June 2016 to consider the outcomes and decide either way.

Do you know which way you’ll be voting? Share your thoughts on the referendum below.

*Based on a study of 800 micro-business owners conducted by AXA Business Insurance in March 2016