Agricultural small business confidence hits 10-year high

The percentage of small business owners in the agriculture sector predicting growth has hit a 10-year high – according to research from Novuna Business Finance.

Across the sector, 40% of agricultural businesses predict growth for the three-month period to 30 September – a sharp rise on 28% during Q2 2024. The Novuna Business Finance study has tracked small business growth outlook since 2014 and this quarter’s result for the agriculture sector is the highest on record.

Percentage of small businesses predicting growth each quarter – results over time

	Q4 2021	Q1 2022	Q2 2022	Q3 2022	Q4 2022	Q1 2023	Q2 2023	Q3 2023	Q4 2023	Q1 2024	Q2 2024	Q3 2024
Agriculture	23%	25%	22%	25%	11%	34%	30%	31%	26%	39%	28%	40%
UK avg.	35%	36%	34%	34%	31%	33%	32%	32%	32%	33%	30%	35%

These findings are part of a survey, commissioned by Novuna Business Finance during the fortnight immediately after the General Election. Nationally, and across all sectors, 35% of UK small business owners are predicting growth for the next three-months – a rise from 30% for the previous quarter. The research reveals a confidence bounce-back that is comparable to the years before Covid – and the resurgence of small business confidence at the start of 2022, when Covid restrictions finally fell away.

Set against reports of sharp falls in business confidence in France and Germany – with fears that the Eurozone’s two biggest economies could be set for a downturn – UK small business confidence has enjoyed a positive upturn in the weeks following Labour’s election win. Across most industry sectors and UK regions, more small businesses are predicting growth than was the case in the three-month period to 30 June.

Other sector findings

Across nine industry sectors, this quarter sees a rise in the percentage of small businesses predicting growth for the next three months (up to 30 September). Compared to the three months leading up to the General Election, there are significant rises in growth predications reported in: Construction (from 15% to 36%), Agriculture (from 28% to 40%), IT/Telecoms (28% to 38%) – and also a welcome boost for the Retail sector (rising from 26% to 37%). Overall, small businesses in the Finance, Agriculture and Media sectors were most likely to be predicting growth over the next three months.

Percentage of small businesses predicting growth by industry sector

	Q3 2024	Q2 2024
Finance / Accounting	44%	41%
Media	40%	36%
Agriculture	40%	28%
Medical	39%	36%
Legal Services	38%	33%
IT / Telecoms	38%	28%
Retail	37%	26%
Construction	36%	15%
Manufacturing	35%	37%
Transport & Distribution	31%	34%
Hospitality/Leisure	30%	30%
Real Estate	28%	25%
Education	26%	33%

Jo Morris, Head of Insight at Novuna Business Finance said: “At Novuna Business Finance, our Business Barometer study has been tracking the growth outlook of small business owners every quarter for more than a decade now.

“The results over time show a remarkable consistency quarter-on-quarter, with outlook seldom changing significantly over a short period of time.

“Our latest research results represent the biggest quarter-on-quarter swing in growth outlook since the spring of 2021. The findings for the agriculture sector are most welcome after a difficult time following Brexit and the lockdown era.

“Overall, we don’t think the latest rise in confidence is based on the political views of small business owners; it’s more a reflection of their perceived need for certainty. The sense of a new government coming in with a big public mandate, together with falling inflation, suggests solidity – and small businesses need a sense of stability and certainty to plan.”