London had an estimated 1,041,565 private sector businesses at the start of 2025, the most of any UK region. Almost all of them are small: 75.2% have no employees and 23.9% have between 1 and 49, so 99.8% have fewer than 250 employees. Businesses with fewer than 250 employees provide about 51% of London’s private sector jobs and turnover (DBT Business Population Estimates 2025; DBT detailed tables). That is lower than the UK-wide figure of around 60% that our earlier version applied to London, so we have corrected it. This guide from The London Report uses official data to show what small businesses contribute to London, which sectors they work in, how they have fared since 2010, and where to find support.
For related guides, see buying a business in London, how to finance a London business purchase and the top industries in London. Figures are estimates and change each year.
Key takeaways
- Scale: 1,041,565 private sector businesses in London at the start of 2025, with 5.98 million jobs (DBT detailed tables).
- Size mix: 75.2% have no employees, 23.9% have 1 to 49, 0.7% have 50 to 249 and 0.2% have 250 or more.
- Jobs: firms with fewer than 250 employees account for about 51% of London private sector employment, while the 0.2% with 250 or more account for 48.6%.
- Biggest sectors by business count: professional, scientific and technical (203,030), construction (123,835) and information and communication (103,565).
- Churn is high: London had the UK’s highest business birth rate in 2024 (12.7%), with a death rate of 10.3% (ONS).
How many small businesses does London have?
DBT estimates that London had 1,041,565 private sector businesses at the start of 2025, up from 718,600 at the start of 2010. The count peaked at about 1,133,800 in 2020, fell to about 982,900 in 2024 and recovered to about 1,041,600 in 2025 (DBT detailed tables). These are survey-based estimates, so small movements between years should be read with care.
| Employee size band | Share of London businesses | Share of employment | Share of turnover |
|---|---|---|---|
| No employees | 75.2% | 13.9% | 5.7% |
| 1 to 49 | 23.9% | 24.8% | 24.7% |
| 50 to 249 | 0.7% | 12.7% | 20.3% |
| 250 or more | 0.2% | 48.6% | 49.3% |
| All businesses | 1,041,565 | 5.98 million jobs | £1,769 billion |
In short, small businesses are numerous and about half of private sector employment, but a few large firms still account for almost as many jobs: the 2,005 London businesses with 250 or more employees account for 48.6% of jobs.
Which sectors do London’s small businesses work in?
By business count, professional, scientific and technical activities is London’s largest sector, with 203,030 businesses, ahead of construction (123,835) and information and communication (103,565). Administrative and support services (90,720) and wholesale and retail trade (88,625) follow (DBT detailed tables). That mix is why London’s small-business scene spans consultants and designers as well as builders, shops and tech firms.
For where UK growth is fastest, see our guide to the top industries in London.
Start-ups, closures and survival
The ONS reports that London had the highest business birth rate of any region in 2024, at 12.7%, with about 76,000 births and 61,000 deaths (a death rate of 10.3%). Nationally, the five-year survival rate for UK businesses born in 2019 was 38.4% (ONS, Business demography, UK: 2024). So London’s small businesses are dynamic, and many do not last. The British Business Bank adds that the UK had 314,000 start-ups in 2025 and that around 50% of smaller businesses used external finance (British Business Bank).
Support for London’s small businesses
| Support | What it offers | Source |
|---|---|---|
| Free one-to-one advice (Growth Hubs) | GOV.UK’s Help to Grow site lets you enter your postcode to find free one-to-one advice in your area | GOV.UK: Help to Grow |
| London’s Growth Hub (Grow London Local) | A Greater London Authority funding document says the hub was rebranded as Grow London Local and is run by London & Partners; check eligibility with your borough | GLA |
| Start Up Loans | £500 to £25,000, unsecured, fixed 7.5% a year, 1 to 5 years, with free mentoring, for businesses under 5 years old | GOV.UK |
| Growth Guarantee Scheme | A 70% government guarantee to the lender, up to £2 million per business group, where you stay 100% liable | British Business Bank |
For more on finance routes, see our guide to how to finance a London business purchase. The British Business Bank also reports that gross SME bank lending rose 9% to £68 billion in 2025, and that 62% of smaller businesses knew where to find information on different types of finance (British Business Bank, 17 March 2026).
Challenges and what to watch
- Survival is hard: only 38.4% of UK businesses born in 2019 were still trading five years later (ONS).
- Most are very small: three in four London businesses have no employees, so many are owner-run with no buffer.
- Numbers swing: the DBT count fell by about 150,000 between 2020 and 2024 before recovering in 2025.
- Finance: about half of smaller businesses use external finance, so knowing the options matters (British Business Bank).
Conclusion
London’s small businesses are its backbone by number and about half of private sector jobs, but the largest firms still carry nearly half of employment, and churn is high. Use official data, check each support scheme’s terms, and see our other guides for buyers and founders. You may also have seen our older link, London, Kentucky: Economy, Employers and Facts (a different London), which is about a different place. For more from The London Report, see our business section.
FAQ
How many small businesses are there in London?
The Department for Business and Trade estimated 1,041,565 private sector businesses in London at the start of 2025, 99.8% of them with fewer than 250 employees (DBT Business Population Estimates 2025; DBT detailed tables).
How many people work for small businesses in London?
Businesses with fewer than 250 employees account for about 51% of London’s private sector employment, out of 5.98 million jobs (DBT detailed tables).
What share of London businesses have no employees?
75.2% at the start of 2025, according to DBT (DBT detailed tables).
Which sectors have the most businesses in London?
Professional, scientific and technical activities (203,030), construction (123,835) and information and communication (103,565) (DBT detailed tables).
How often do small businesses in London close?
The ONS reported a London death rate of 10.3% in 2024 and a birth rate of 12.7%. Across the UK, 38.4% of businesses born in 2019 survived five years (ONS).
Where can small businesses in London get free advice?
Your local Growth Hub offers free one-to-one advice (use the postcode finder on GOV.UK). London’s Growth Hub is run by London & Partners as Grow London Local, according to a GLA funding document (GLA).
What loans are available to small businesses?
Start Up Loans offer £500 to £25,000 at a fixed 7.5% (GOV.UK), and the Growth Guarantee Scheme gives lenders a 70% guarantee (British Business Bank).
Is the old 60% jobs figure right for London?
No. About 60% is the UK-wide share of employment in SMEs. For London it is about 51% (DBT detailed tables).
Where can I read more about London business?
See our guides to buying a business in London, how to finance a London business purchase and the top industries in London.
Editor’s note: what changed in this update
On 11 November 2026 we rewrote this page. The 2024 version made general claims about job creation, innovation, resilience and policy that were unsourced, and applied a UK-wide figure of around 60% SME employment to London. We replaced it with the Department for Business and Trade’s regional estimates, ONS business demography and British Business Bank data, added charts and tables, and swapped the Pinterest embeds for licensed photos. We kept our link to the London, Kentucky guide, but now label it as a different place.
Sources
- DBT Business Population Estimates 2025; DBT detailed tables (Tables 9, 17 and 26)
- ONS: Business demography, UK: 2024 (20 November 2025)
- British Business Bank: Small Business Finance Markets 2025/26; Growth Guarantee Scheme FAQs
- GOV.UK: Apply for a Start Up Loan; GOV.UK: Help to Grow, local Growth Hub; GLA: Growth Hub funding 2025-26
Disclaimer
This article is for general information only and is not financial advice. Business numbers are survey-based estimates that change each year, and support schemes change their terms, so check official sources before you decide.
Last updated: 11 November 2026
