In the wake of the pandemic and ongoing changes in the economy, UK businesses are expected to face a number of risks in 2023. Tradesman Saver, a leading insurance provider for tradespeople and small businesses, has identified the top five risks based on insights from risk management experts across 94 countries and territories.
- Cyber incidents: Cyber incidents, including IT outages, ransomware attacks, and data breaches, continue to be the top risk for UK businesses. With ongoing geopolitical tensions and conflict, there is an increased likelihood of large-scale cyber-attacks. Data breaches are a major concern for companies, with potential for significant notification costs, fines, penalties, and reputational damage. Small businesses are particularly vulnerable due to weaker security controls and fewer resources to deal with 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, disruptions persist. The recent turmoil in Ukraine and global supply chain issues, such as semiconductor shortages, are causing further strain on businesses.
- Macro-economic developments: Macro-economic developments, including inflation, deflation, and monetary policies, have emerged as a new risk in 2023. The ongoing crises in the US, China, and Europe, along with the Russian invasion of Ukraine, have led to increasing energy prices and inflation. Although the UK is currently in a recession, 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 a new entry for 2023 and has impacted businesses. 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, persists as a risk for UK businesses. The situation is exacerbated by post-Brexit immigration rules. The construction industry is among the hardest hit, with 75% of contractors experiencing recruitment issues.
To help UK businesses navigate these risks, Tradesman Saver provides tailored insurance solutions to protect against potential losses. Public liability insurance is one such solution that can safeguard your business. To learn more about how Tradesman Saver can support your business, visit our website https://www.tradesmansaver.co.uk/public-liability-insurance/ or call our helpline for more information.
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