Tradesman Saver, a renowned insurance provider for small businesses and tradespeople, has identified the top five risks that UK businesses are expected to face in 2023. Based on insights from risk management experts across 94 countries and territories, these risks could have a significant impact on businesses of all sizes.
2023 is likely to be one of the most challenging years for businesses in the UK. With the aftermath of the pandemic and the rise of technologies such as artificial intelligence, businesses will need to adjust their strategies to ensure success.
Here are the top 5 risks that UK businesses should be aware of:
- Cyber Incidents: Cyber incidents, such as data breaches, IT outages, and ransomware attacks, continue to be the top risk for UK businesses. Ongoing geopolitical tensions are making it increasingly likely that large-scale cyber-attacks will occur. Data breaches can result in significant notification costs, fines, penalties, and reputational damage. Small businesses are particularly vulnerable to cyber incidents due to weaker security controls and fewer resources to deal with the aftermath of an attack.
- Business Interruption: Business interruption, including supply chain disruption, is another significant risk for UK companies. Despite efforts to diversify business models and supply chains post-pandemic, disruptions still occur. Ongoing global supply chain issues and the recent turmoil in Ukraine are causing further strain on businesses.
- Macro-Economic Developments: Macro-economic developments, such as inflation, deflation, and monetary policies, have emerged as a new risk in 2023. The simultaneous crises in the US, China, and Europe, along with the Russian invasion of Ukraine, have led to increasing energy prices and inflation. The UK is currently in a recession, with the economy expected to contract 0.7% in 2023. However, some experts predict a return to growth during the second half of the year as inflation and energy prices begin to stabilize.
- Energy Crisis: The energy crisis is another new risk for UK businesses in 2023. Energy prices have risen due to post-pandemic economic recovery, supply chain disruptions, and delayed maintenance work. The crisis intensified with the invasion of Ukraine by Russia, the world’s largest exporter of fossil fuels. Although the UK relies on Russia for less than 4% of its total gas supply, it remains susceptible to fluctuating international gas prices.
- Shortage of Skilled Workforce: The shortage of skilled workforce, a consequence of the Covid-19 pandemic and rising wage inflation, continues to persist as a risk for UK businesses. Many countries, including the UK, are facing a reduced workforce and high demand for labor. Post-Brexit immigration rules have also exacerbated the situation. The construction industry is among the hardest hit, with 75% of contractors experiencing recruitment issues.
Protect Your Business with Public Liability Insurance Tradesman Saver is committed to helping businesses navigate these risks by providing tailored insurance solutions to protect against potential losses. To learn more about how Tradesman Saver’s public liability insurance can support your business, visit our website at https://www.tradesmansaver.co.uk/public-liability-insurance/ or call our helpline for more information.
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