Almost half of UK small and medium-sized enterprises (SMEs) are optimistic about the year ahead, according to new research from Simply Asset Finance released ahead of the Autumn Budget. The study shows that 49% of business decision-makers feel positive about the next 12 months, up from 43% a year ago. Nearly one in five, or 19%, say they are “really excited” about growth prospects, more than double the 8% recorded in 2024.
Despite this rising confidence, SMEs continue to face significant challenges. High energy costs remain the primary concern, with 40% of firms calling for targeted government support. Among medium-sized businesses, this figure rises to 54%. The UK’s energy prices are among the highest in advanced economies, prompting warnings that businesses are operating at a structural disadvantage.
Inflation, taxes, and interest rates are also major barriers to growth. Around 34% of SMEs are seeking enhanced tax incentives to stimulate investment and innovation, while 36% are calling for corporation tax cuts, nearly double the 19% reported in 2024. Access to affordable finance remains important, with 26% of firms highlighting the need for better government-backed loans to support expansion plans.
Confidence that the government will deliver a pro-business Autumn Budget is low, standing at just 36%. Nearly half of SMEs (46%) cite a stagnant economy as a hurdle, 39% point to persistent high inflation, and 30% highlight high interest rates. Overall, 68% of businesses say the upcoming Budget will have a “significant” or “fundamental” impact on their growth plans, placing added pressure on policymakers ahead of the 26 November announcement.
Mike Randall, CEO of Simply Asset Finance, said the findings underline a mix of optimism and frustration among SMEs. “It’s incredibly encouraging that SMEs are showing a clear appetite to invest and grow,” he said. “But there is continued frustration at the lack of support with ever-rising costs and the same barriers blocking their path forward.”
Randall added that energy costs remain the most pressing issue. “Businesses are clear they need support to allow more room to invest. With the UK facing some of the most expensive energy costs in the world, firms are operating at a disadvantage and something needs to give.”
He warned that the government has a critical opportunity in the upcoming Budget. “The right decisions could unlock growth and fuel productivity across the UK; the wrong ones risk stalling momentum at a defining moment,” he said.
The research highlights that while UK SMEs are increasingly hopeful about their prospects, structural cost pressures and financial barriers continue to weigh heavily, underscoring the importance of policy measures that support growth and investment.
