According to a new report, small businesses are facing a tough year financially as a result of poor mental health nationwide.
The small business insurer, Simply Business, has released its latest study on SME financial buoyancy and risk and says the data indicates a mental health crisis will severely impact enterprises over the next 12 months.
Founded in 2005, Simply Business is the trading name of Xbridge Ltd - an online broker of business insurance with over 800,000 customers based in London. It has partnered with a range of experts – from clinical psychologists to sleep experts – to offer free wellbeing tips and resources tailored to the self-employed.
The insurtech’s latest data reveals worrying figures that suggest up to 82% of small business owners have reported a decline in their mental health since the start of the pandemic.
The stress and anxiety caused by lockdowns and the fear of future restrictions, financial challenges, supply chain issues, and general worry about the virus, has resulted in growing concern as 30% of SME owners report they have suffered from depression, while 55% say their anxiety has increased significantly.
Small business owners and mental health risks
According to Simply Business’s report, almost half of the respondents they interviewed (47%) were worried about their mental health in 2021, and one in five (19%) believed their mental health problems had occurred due to the pandemic.
Significantly, 30% experienced depression, three in five (62%) have been affected by stress and over half (55%) have suffered from anxiety. With SME owners still facing challenges in 2022, there continues to be a risk to small business owners’ mental health.
The report said, “These statistics are particularly concerning when paired with the difficult circumstances many still find their businesses in, due to the pandemic. More than half (52%) live in fear of future lockdowns and the impact it could have on trade.”
Supply chain anxiety for small business owners in 2022
The mental health crisis has been compounded by supply chain issues and the research shows that one in five (21%) of UK-based small business owners believe supply chain issues will hit them badly in the coming year – with ongoing challenges in getting goods to customers, or sourcing the stock they need. A further fifth (20%) have experienced difficulty bringing in enough customers to help with their financial recovery from Covid-19.
Wellbeing for small business owners
Despite the current situation, Simply Business reports that a good percentage of SME owners are concentrating on improving their mental health through a range of mechanisms.
Two in three (67%) are spending more time outside and in nature where possible, while a further 64% are exercising more frequently and dedicating more time to connecting with friends and family (also 64%).
The study also reported that; “A third (32%) have used reading as a tool to improve their wellbeing, while 27% have turned to gardening hobbies. Other activities that small business owners say help their wellbeing include mindfulness and meditation (25%) and exploring arts and crafts (21%).”
Speaking about the difficulties being managed by the UK’s small business community, Alan Thomas, UK CEO at Simply Business, explained, “Small business owners have encountered countless challenges during the course of the pandemic, with Covid-19 costing owners over £20,000 each on average. Livelihoods are on the line, and understandably this has had a huge impact on people's wellbeing – with a staggering 82% reporting poor mental health last year.”
He continued, “Entering 2022, it’s clear that many of these challenges remain – from staff shortages to supply chain issues. This worrying situation should concern us all because small businesses are crucial to our economy and communities – and will be central to our collective recovery.
Thomas said that Insuring over 850,000 small business owners and landlords had helped Simply Business understand the specific wellbeing challenges being faced by the self-employed, and the reasons behind this concerning data.
He concluded, “It’s vital that we support the individuals behind small businesses, and that’s why – in addition to shining a light on the emerging wellbeing crisis among this audience – we’ve partnered with a range of experts to offer free tips and resources tailored to the self-employed.”