Industries with Most Risky Business Environments in the UK in 2025

1. Hard Coal Mining in the UK

Business Environment Risk for 2025: 7.5

Over the five years through 2022-23, hard coal mining revenue is forecast to fall at a compound annual rate of 26.2%. Before COVID-19 hit, coal prices were inching downwards as demand for coal from electricity generators fell. The drop in sales and revenue has contributed to a sharp drop in the number of UK coal mines in the UK, with numerous mining licences expiring.

The COVID-19 outbreak accelerated the closure of coal mines in the UK; however, as the pandemic started to wind down, coal prices rose in response to supply chain disruptions. Russia's invasion of Ukraine has also played a... Learn More

2. Healthcare Construction in the UK

Business Environment Risk for 2025: 7.0

Companies in the Healthcare Construction industry construct, repair, maintain and alter health and social care buildings and facilities on behalf of private and public-sector entities. While private finance plays a vital role in the funding of healthcare real estate and infrastructure development, the capital departmental expenditure limit (DEL) of the Department of Health and Social Care (DHSC) underpins healthcare construction procurement in the National Health Service (NHS) and among NHS trusts. Healthcare estate provides the foundations for good health and social care delivery. As such, capital investment funding for healthcare construction projects has remained at the forefront of government policy,... Learn More

3. Tool Manufacturing in the UK

Business Environment Risk for 2025: 6.8

Revenue is forecast to contract at a compound annual rate of 6.4% over the five years through 2023-24 to £1 billion. Declining revenue can be attributed to weak industrial activity, particularly from manufacturing, oil and gas exploration and extraction markets, and mining and quarrying industries. Additionally, the lion's share of household tools are manufactured in low-cost regions and countries, like China. These imported tools pose fierce competition to domestic producers and have become increasingly popular, weighing on revenue.

Revenue fell significantly in 2020-2 owing to disruptions caused by the COVID-19 pandemic, resulting in downstream construction and industrial markets reducing output. Construction... Learn More

4. Vodka Distilleries in the UK

Business Environment Risk for 2025: 6.6

Alcohol consumption, demand from pubs and bars, disposable income, health consciousness and the exchange rate heavily influence vodka distilleries revenue. The COVID-19 pandemic led to strict restrictions imposed on the hospitality sector, with sales to the on-trade tumbling as a result. Rising rates of at-home social gatherings led to an uptick in sales to the off-trade, although this wasn't enough to prevent a substantial fall in revenue and profitability in 2020-21. Revenue rebounded in 2021-22 as social distancing restrictions eased and people flocked back to bars and pubs. Demand for premium spirits is driving revenue growth in 2023-24, although it's... Learn More

5. Clothing Manufacturing in the UK

Business Environment Risk for 2025: 6.6

Over the five years through 2023-24, the clothing manufacturing industry is expected to contract at a compound annual rate of 5.4% to £2.2 billion. Before the pandemic, manufacturers relied on the strength of the Made in Britain label and the boom in emerging economies, creating a new wave of consumers with spending power, desiring British-made goods and brands like Mulberry and Burberry. While production in the Far East is not as cost-efficient as it once was, imports have remained a significant share of the domestic clothing market, hindering industry growth prospects. Nonetheless, the number of manufacturers entering the industry has... Learn More

6. Tobacconists in the UK

Business Environment Risk for 2025: 6.5

Tobacconists sell tobacco products like cigarettes, cigars, pipes and accessories. Over the five years through 2023-24, their revenue is expected to decline at a compound annual rate of 3.4% to £521.9 million. Rising public awareness of the health risks of smoking, driven by intense anti-smoking campaigns by the government and activist groups, has caused smoking rates and sales to plummet for tobacco retailers. Strong legislation has hit sales hard, while stiff competition from supermarkets and convenience stores has stolen revenue away from specialist tobacco retailers. A stubborn illegal tobacco market and an increase in cross-border smuggling of illegal tobacco products... Learn More

7. Wired Telecommunications Carriers in the UK

Business Environment Risk for 2025: 6.5

Over the five years through 2022-23, wired telecommunications carriers' revenue is set to contract at a compound annual rate of 3.5% to £16.5 billion. Declining revenue has come from consumer preferences shifting to wireless telecommunications as they've improved in quality. Nevertheless, demand for fast and reliable connections and the expansion of full-fibre network services have somewhat supported demand.

Mobile and digital technologies are becoming more popular at the expense of wired telecommunications services, like landline telephony. Providers have attempted to mitigate lower demand for industry services by bundling traditional telecommunication offerings with popular services. However, this has come at the expense... Learn More

8. Off-Licences in the UK

Business Environment Risk for 2025: 6.5

Off-licences are facing major hurdles. Supermarkets have been undercutting them on prices and online retailers have been further eating into the market, undercutting off-licences because they don't have to pay for rent or customer-facing staff. The COVID-19 pandemic helped a bit by shutting down the hospitality sector, cutting out a key source of competition, but revenue still fell in 2020-21 and now off-licences are feeling the squeeze again.

In 2023-24, surging food and energy costs are set to tighten household budgets, reducing demand for wine, beer, spirits and snacks – that's why is forecast to contract by 2.5%. Shifting attitudes toward... Learn More

9. Live Animal Wholesaling in the UK

Business Environment Risk for 2025: 6.5

The price and demand for cattle, sheep, pigs, poultry and horses strongly influence live animal wholesalers' revenue. Abattoirs, a major market for wholesalers, have contended with labour shortages after they lost access to the EU labour pool following Brexit. Abattoirs had to operate substantially below capacity during parts of 2021, prompting the government to issue temporary visas for 800 foreign butchers, helping to ease shortages. However, abattoir numbers are tumbling because of high operating costs, tightening regulations regarding animal welfare and low profitability – constraining the potential market for wholesalers. Teething issues regarding new trade certifications at EU-UK borders led... Learn More

10. Iron & Steel Manufacturing in the UK

Business Environment Risk for 2025: 6.4

Over the five years through 2022-23, revenue is expected to fall at a compound annual rate of 4.1%. Large amounts of cheap steel on the global market have undercut British prices and caused major trade partners like the EU to institute import quotas. Unable to lower prices because of high labour costs and environmental charges, industry giants like British Steel and Tata Steel have stated a need for government intervention to continue operating. The industry is also wracked by volatility as overproduction followed by strict pandemic restrictions in China have caused global steel prices to fluctuate.

The Russian invasion of Ukraine... Learn More