Net business sentiment about Brexit amongst small and medium sized businesses has dropped by 12 percentage points.
Net business sentiment about Brexit amongst small and medium sized businesses has dropped by 12 percentage points since January, according to an analysis of the social media posts made by over 32,000 firms.
This marks the steepest monthly drop in sentiment since the analysis began over a year ago. Negativity is also at its highest level since the analysis got underway.
According to the research, commissioned by KPMG and compiled by Impact Social, social media posts containing positive sentiment were down by 5 percentage points and posts containing negative sentiment were up by 7 percentage points since January. In numerical terms, 24,389 posts were analysed, of which 3,170 were positive posts about Brexit, 4,634 were negative posts about Brexit, and 16,585 were neutral.
Explaining the findings, James Stewart, Head of Brexit at KPMG UK said:
“The UK’s small and medium sized businesses are normally pretty up-beat or neutral about Brexit but this began to change in November and the picture has been deteriorating ever since, with the period January to February marking a particular decline. In many ways SMEs are the heartbeat of our economy so to see their confidence falling is significant.
“The voice of small and medium sized businesses is often forgotten in the Brexit debate and this can make the public discourse somewhat lopsided. This unique data-point shows us how small and medium sized enterprises don’t want to be distracted from building up their businesses. Unlike the big firms, small and medium sized businesses have neither the cash reserves to start stockpiling or a great deal of flexibility in their financing arrangements.”
In the analysis, social media posts with positive sentiment were mainly focussed on: Growth (28%), employment positivity 13%, fund raising success 12%, regional positivity 10% and women in business 9%. Social media posts with negative sentiment were mainly focussed on: How Brexit is unfolding (25%), politics (20%), automotive jobs (12%), the economy (11%) and the business casualties of Brexit (11%). Another finding was that those who were more positive are often focused on growth and investment more generally.
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Notes to editors:
About the Tracker
The KPMG SME Tracker is an analysis compiled by Impact Social. It tracks the Twitter messages of 32,000 British small and medium sized companies and business people, searching their public posts for indicators of their sentiment towards the state of the economy, their own business performance, and their reaction to government policies. In the time from 15-19 February 2019, they had tweeted more than 24,000 times. Those aggregated search results are then analysed manually by Impact Social’s researchers to assess whether the messages are positive, negative or neutral. That process also strips out posts that are promotional, leaving only the businesses’ opinions on the topics in question.
About KPMG in the UK
KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 16,300 partners and staff. The UK firm recorded a revenue of £2.338 billion in the year ended 30 September 2018. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 154 countries and has 200,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.