2025 POLICY ROADMAP

Access to international markets for the UK’s new entrepreneurs remains below pre-2020 levels and is not improving. Latest data from the Small Business Survey shows that the proportion exporting has slipped to 17%, continuing a gradual decline since 2020.  Only 36% of exporting non-employers planning to increase their international activity in the coming years, compared with nearly half (49%) the previous year.

The recent British Chambers of Commerce survey highlights that export conditions remain tough, especially for smaller exporters, with weak sentiment and limited growth in export orders: fewer than one in five micro-exporters reported increased orders. The BCC has emphasised that without stronger practical support, finance and advice embedded in the UK’s trade strategy, many smaller firms will continue to struggle to expand in overseas markets.

Over the past twelve months, the UK Government has introduced several significant policy changes that directly affect entrepreneurship, particularly through a comprehensive national Small Business Plan and the UK’s Trade Strategy. ‘Backing your business: Our plan for small and medium-sized businesses’  is a long-term strategy designed to improve the environment for start-ups and scaling ventures by tackling barriers across finance, regulation, market access and skills. At the same time, the UK Trade Strategy introduced a series of trade-related reforms intended to improve the operating environment for entrepreneurial ventures engaging internationally.

Together, these policy shifts represent a welcome attempt to support entrepreneurial activity and tackle structural barriers that can constrain new business formation and growth.

2025 Framework Conditions Review

The National Entrepreneurial Context Index (NECI) reflects the overall quality of an entrepreneurial environment, as assessed by its own national experts. The United Kingdom’s NECI score for 2025 is 4.2, down from 4.5 in 2024. This decline places the UK at 37th out of 53 GEM economies globally, a drop of eight places from the previous year. The fall in NECI reflects broad-based deterioration across most framework conditions, including in education, infrastructure, and government support. 

Of thirteen Framework Conditions, UK national experts rate only two as sufficient or better (i.e. score ≥ 5.0), down from three in 2024. These are: Commercial and Professional Infrastructure (5.1), Ease of Entry: Market Dynamics (6.0). The remaining eleven conditions are rated as insufficient, with particularly low scores for: Entrepreneurial Education at School (2.7), Research and Development Transfers (3.6), and Ease of Access to Entrepreneurial Finance (3.6). Just one condition improved its score: Ease of Entry: Market Dynamics (from 5.3 to 6.0), while twelve conditions declined in score, most notably Physical Infrastructure (from 5.7 to 4.9), and Government Entrepreneurial Programmes (from 4.3 to 3.7). The UK now ranks in the bottom ten globally (of 53 GEM economies) for Physical Infrastructure (51st), and for Entrepreneurial Education post School (46th). Its highest rank is for Ease of Entry: Market Dynamics.

New entrepreneurs’ awareness of the need to develop and implement AI solutions was scored highly by national experts at 6.4, up from 6.0 in 2024. However new and growing businesses’ prioritisation of sustainability was rated as sufficient at 5.3, down from 5.6 in 2024.

The United Kingdom’s entrepreneurial environment in 2025 shows signs of strain, with a declining NECI score and widespread deterioration across framework conditions. While market dynamics remains a strength, infrastructure, education, and government support are pressing areas for improvement. AI awareness is growing, but institutional and educational support must catch up to sustain competitiveness.

2025 Entrepreneurial Activity Review

Just under one in four adults in the United Kingdom report that their household income has fallen in 2025, a steady decline from 2024. Approximately one in six (16%) adults intend to start a business in the next three years, continuing a rising trend from 14% in 2024 and 8% in 2019. 

Entrepreneurial awareness, confidence and opportunity recognition in the UK are reasonably high. Three out of five adults know someone who has started a business recently or see themselves as having the skills and experience to start their own business.  Over half see good opportunities to start a business locally, but just under a half of these would not start a business for fear it might fail. 

Despite the entrepreneurial environment weaknesses noted above, more than one in five adults are starting or running a new business in 2025, up from one in seven in 2024 and one in twelve in 2020. One in eight own an established business, rising from one in ten in 2024, and little over one in twenty in 2020. The ratio of new to established businesses has widened, indicating a surge in early-stage entrepreneurial activity. Men are more likely than women to be starting a new business, with a ratio of approximately 5:4. 

The most common motivation among new entrepreneurs is “to build great wealth or very high income” - 78%, although a similar proportion (72%) reported that “to make a difference in the world” was important. Seven out of ten new entrepreneurs expect to use more digital technology to sell their product in the next six months. Despite the lingering impacts of Brexit, a half of new entrepreneurs have customers beyond the United Kingdom, up from two in five in 2024. One-third of new entrepreneurs anticipate employing more than another five people in five years’ time, a significant increase from one-fifth in 2024. Seven out of ten have taken steps to minimise environmental impacts in the past twelve months, with only slightly fewer having taken steps to maximise social impacts. Nearly four out of five report prioritising such impacts above profitability or growth.