UK firms taking early action as they brace for hits from tariffs – survey

More than three-quarters of UK businesses are worried about tariffs and global trade uncertainty and have already taken pre-emptive measures to offset disruption, according to a new survey.

The latest Barclays business prosperity report found that 79% of firms are concerned about the mounting global trade war sparked by US President Donald Trump’s move to hike tariffs.

The poll of 1,000 micro, small and larger firms – which was conducted last month – revealed that nearly half (48%) have already begun changing their US operations or supply chains to help offset any possible hit.

It showed that 14% have already scaled back investment in the US market, with 15% pausing or cutting spend in America.

The research suggests that almost half of firms (44%) were increasing international trade over the past year, of which 59% reported doing so with Europe and Central Asia, far outweighing those growing trade with the US (18%) and Asia-Pacific (44%).

Firms – particularly larger companies – are optimistic that the possible upsides from America’s tariff hikes will outweigh the initial impact on profit margins, demand and exports, according to the report.

But more than a third (37%) are still bracing for a hit from US tariffs on their overall business prospects.

Despite this, 86% of firms remain confident in their own prosperity over the next three to five years.

Matt Hammerstein, chief executive of Barclays UK corporate banking, said: “Given the widespread uncertainty in the international trade environment, it’s unsurprising that businesses are taking proactive steps to adapt to these global pressures.

“A strong international trade strategy, and revised supply chain considerations, can turn geopolitical uncertainty into a competitive advantage and many larger firms are already adapting to build diverse global trade to develop resilience.”

With many firms under pressure from tariff woes and hiring difficulties, productivity has become ever more important than it was a year ago, according to 46% of firms surveyed.

This comes as 72% of those polled said difficulties in hiring skilled labour was holding back growth.

Hannah Bernard, head of Barclays business banking, said: “Productivity gains are seen as vital to help offset the increasing cost pressures on businesses.

“The focus on upskilling staff through training and development is a positive way for firms to combat skilled labour challenges, alongside efficiencies from digital transformation through emerging technologies such as AI.”