Top 10 Biggest Industries In The UK Today

Top 10 Biggest Industries In The UK. Photo KnowInsiders

Having the sixth-largest economy after the US, China, Japan, Germany and India, the UK has a gross domestic product of 2.83 trillion dollars in 2019 with a population of around 66 million. Note that the UK includes England, Scotland, Wales and North Ireland. The economy of the UK is quite diverse and has therefore a large array of key sectors.

Top 10 Biggest Industries By Revenue In the UK

1.Supermarkets	$189.9B
2.Pension Funding	$155.9B
3.Construction Contractors	$121.8B
4.Banks	$112.0B
5.New Car & Light Motor Vehicle Dealers	$98.4B
6.Hospitals	$96.8B
7.General Insurance	$70.9B
7.Management Consultants	$70.9B
9.Pharmaceutical Wholesaling	$61.1B
10.Computer Consultants	$55.9B

1.Supermarkets

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Revenue for 2021: $189.9B

Industry revenue is expected to grow at a compound annual rate of 1.7% over the five years through 2021-22 to reach £207.1 billion. Changing shopping habits, the aggressive expansion of discount supermarkets and increased external competition have influenced industry performance over the past five years. The largest operators have cut prices to attract greater loyalty from their customers. The Big Four's grip on the industry has weakened as a result of slipping profit margins, and a weak pound since the EU referendum has eaten into profit. Nevertheless, supermarkets have been expanding into the Convenience Store industry.

2. Pension Funding

Revenue for 2021: $155.9B

The Pension Funding industry comprises defined benefit (DB) schemes and defined contribution (DC) schemes. Over the past decade, the industry has been transformed by the ongoing shift from DB to DC schemes, which in 2021-22 are estimated to account for 61% and 39% of total industry assets respectively. Industry revenue, which is calculated by combining contributions and investment returns, has increased over the past five years. The increase in contributions was fuelled by the phased introduction of automatic enrolment in pension schemes, which began in October 2012 and was fully phased in by February 2018.

What are the major UK Industries? The service sector is the largest sector in the whole UK according to the UK Office for National Statistics. It amounts to three-quarters of the Gross domestic product. What is the service industry exactly? It is compromised of many other industries which include finance and business services and consumer-focused industries (examples like entertainment, food and beverages and retail). Next up, manufacturing and production only amount to 21% of the Gross Domestic product whereas agriculture just 0.60%. Looking at the manufacturing sector according to The Blue Book: 2019 from UK Office for National Statistics (ONS), it only grew 0.4% even after experiencing a growth in 2017. On the contrary, the construction output dropped by a meagre 0.4% in 2018. Within the UK manufacturing sector, the food products division is the largest, yet it boasted a decrease in sales of 0.9 billion British Pounds in 2019 from 2018. The service industry’s growth over 2 years (numbers from 2018) by 2.1%. Brexit has had its influence on the matter, slowing down the overall real household consumption.

3. Construction Contractors

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Revenue for 2021: $121.8B

The construction Contractors industry is broader than what many think. Not only is it handling building construction and civil engineering markets, but a few operators are also paid for fulfilling maintenance, repair, for completing new building and infrastructure construction contracts etc. Three main “activities” can be recognised and demanded: independent contractors that focus mostly on small scale contracts, contractors focussed on the construction of new residences and civil engineering handle the client’s services throughout the value chain of infrastructure.

One can only guess that this industry has a quite large importance in the overall industries in almost every country and the UK is no exception.

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4. Banks

Revenue for 2021: $112.0B

There are two types of banks, retail and commercial ones, but they have the same way of generating most of their money. That is through charging interest on loans, and a second one where the revenue is derived by non-interest income from overdraft and card fees.

Over a span of five years, this industry is said to decline, however. The compound annual rate at which it will decline is 2% to 99.8 billion pounds. During the last five years, the income of the banking industry has been affected negatively due to a low-interest-rate environment from loans. There has been economic uncertainty since the famous EU referendum and that has led to a restricted demand of mortgages. All the while what reduced demand for commercial loans was subdued business confidence.

5. New Car & Light Motor Vehicle Dealers

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Revenue for 2021: $98.4B

Industry revenue is anticipated to fall at a compound annual rate of 4.3% over the five years through 2021-22 to £110 billion. New car registrations have declined as a result of economic uncertainty caused by the EU referendum. Rising fuel prices and a weak pound have inflated the cost of new car ownership, restricting demand. Profit margins are estimated to have fallen to 6.3% over the five years through 2021-22. The propensity of consumers to spend on discretionary items has been curbed by low consumer confidence and business expenditure.

6. Hospitals

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Revenue for 2021: $96.8B

This industry provides medical diagnostic and treatment services at general hospitals as well as specialised ones. Over the five years, the revenue is expected to go up at a compound annual rate of 1.6%, eventually reaching £101 billion. The demand has increased due to an ageing population, failing to keep up with this, public healthcare has made room for more demand for private hospitals as a greater number of patients seek private treatment.

The National Health Service (NHS) has suffered the slowest decade of spending growth in its existence, while inpatient admissions have risen and the total number of beds available has declined.

UK industries and the Brexit The Brexit, the UK’s decision to leave the European Union in June 2016, formally and officially took effect on January 31, 2020. Ever since a number of non-governmental organizations and government agencies have anticipated that the unclarity around ongoing Brexit negotiations would have a negative impact on the UK industries and economy. The current reality is that the actual economic impact of Brexit itself is still unclear. The COVID-19 and the lockdowns since the Brexit have had a major influence on an economic event which has made it difficult to assess the real cause. The Institute for Government, through numerous analyses’, has found out that the majority of projections are negative. Ranging from an 18% loss to a 7% gain of economical output as a result of Brexit. Research done by a pro-EU and anti-Brexit facility, the Centre for European Reform, has concluded that the cost of leaving the EU for the UK’s public finances amount to 17 billion pounds in 2018 starting from September. There are areas that were affected according to The UK’s Office for Budget Responsibility, a government agency, following the Brexit negotiations. Business investments and the prospect of less access to foreign markets are included. Declines have appeared in the exchange rate because of this, which are raising inflation and reducing consumer income. And consumer income and spending are contributing less to economic growth as a result.

7. General Insurance

Revenue for 2021: $70.9B

Businesses in this industry underwrite general insurance policies relating to property, casualty, liability, motor vehicles and other general risks. The premiums they earn from these activities are then invested to generate additional income. The industry provides services to both private and commercial clients. Underwriting life and disability do not fall within this industry, although general health insurance does.

Over the five years through 2021-22, industry revenue is expected to decline at a compound annual rate of 0.4%.

7. Management Consultants

Revenue for 2021: $61.5B

Covering a broad range of consulting services, the Management Consultants industry includes sub-activities such as marketing, strategic and organisational planning, business process management, human resource consulting and IT.

This industry’s revenue is expected to increase to a staggering 64.1 billion pounds at a compound annual rate of 3.6%. The demand for IT services is mainly the reason for this growth. Furthermore, regulatory changes falling upon the financial services sector, the biggest downstream market, have largely benefited the industry.

9. Pharmaceutical Wholesaling

Revenue for 2021: $61.1B

The pharmaceutical and healthcare supply chain is characterised by extreme change. The loss of patent protection for several high-profile drugs hampered performance because it tends to lower the revenue generated from such drugs. Increasingly stringent regulation has encouraged greater consumption of generic medicines and intensified downward pricing pressures. Despite this, opportunities for growth remain. In response to rising competitive pressures, some operators have consolidated or merged to extend their role within the pharmaceutical and healthcare supply chain, and to increase their product portfolios and geographical presence. Pharmaceutical wholesalers have also benefited from an expanding and ageing population.

10. Computer Consultants

Revenue for 2021: $55.9B

Composed of businesses that provide expert advice and assistance in planning and designing computer systems that integrate computer hardware, software and communication technologies, the Computer consultants industry provides services to clients in all sectors of the economy. However, clients within the financial services sector and the public sector are key targets of this market. This industry is said to grow, also thanks to the COVID-19 pandemic. Demand for industry services is largely influenced by business confidence levels, which typically rise and fall in line with general economic conditions, and technological advancements, particularly those that are beneficial to businesses.

Top 10 Biggest Industries In the UK By Employment

Going over the industries ranked by employment, we can see some similarities between the industries ranked by revenue. Here is a shortlist with a few things to note about these industries.

1.Supermarkets

Employment number for 2021: 1,220,923

Same as before with a different outcome. The supermarkets’ industry in the UK has seen an increase for the last five years. Which in turn led to a higher demand for employees.

2.Hospitals

Employment number for 2021: 838,617

Largely due to the COVID-19 pandemic. However, it is important to note that the public sector is suffering a bit due to the higher demand for the private sector.

3.Charities

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Employment number for 2021: 812,020

This covers a broad range of charitable objectives, from emergency relief and international aid to arts programmes.

4.Temporary-Employment Placement Agencies

Employment number for 2021: 701,613

This industry’s Businesses supply clients with workers to temporarily replace or supplement the labour force they currently have. The uncertainty of the EU referendum and the COVID-19 pandemic has led businesses to resort more to temporary employment. Because when the economy is strong, there is no need for temporary workers, but these times have made the demand for them grow.

5.General Secondary Education

Employment number for 2021: 695,038

This industry has as its goal to provide education to students between 11 and 18 years of age. The schools in the General secondary education industry are funded by local education authorities (LEAs) or the government. The industry also includes privately funded independent schools, however. They are likely to play a big factor in the growth of this industry over the five years from 2020-2021 onwards.

6.Direct Selling and Marketing

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Employment number for 2021: 694,519

Providing their services to consumers away from a fixed retailing location and exclusively, the Direct Selling & Marketing industry only operates through personal contact. The industry markets and retails a wide variety of products. Please note that the sale of fuel and food for direct consumption is not part of this industry. Marketing itself through two methods, being single-level marketing (SLM) and multi-level marketing (MLM). The SLM means that representatives earn money solely from commission whereas the MLM means that representatives earn commission from both their sales and those that they have recruited.

7.Construction Contractors

Employment number for 2021: 548,498

The construction Contractors industry is broader than what many think. Three main “activities” can be recognised and demanded: independent contractors that focus mostly on small scale contracts, contractors focussed on the construction of new residences and civil engineering handle the client’s services throughout the value chain of infrastructure.

8.Full-Service Restaurants

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Employment number for 2021: 484,693

Over the first few years of the past five-years, the Full-Service Restaurants industry grew sharply. However, following the UK’s vote to leave the European Union, the cost increases and weak consumer demand turned this trend around in the second half of the five-year period. As trends in consumer preferences change, so does his industry’s performance.

9.Management Consultants

Employment number for 2021: 443,799

Covering a broad range of consulting services, the Management Consultants industry includes sub-activities such as marketing, strategic and organisational planning, business process management, human resource consulting and IT. Following the trend in revenue, this industry’s employment number also rose over the last five years.

10.Universities

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Employment number for 2021: 426,120

In the UK, the cap on undergraduate students was also lifted over the past five years, leading to a rise in student enrolments. The Universities’ industry’s revenue is expected to increase at a compound annual rate of 1.3%, reaching 40.8 billion pounds. Not only thanks to more students, this expansion can also be attributed to rising tuition fees and growing investment returns.

Top 10 Biggest Industries In The UK By Number of Companies

Rank	Industry	Number of Companies	% of total Companies
1	Professional, scientific, and technical	467595	0.1701
2	Construction	351250	0.1277
3	Business administration, and support services	235755	0.0857
4	Information and communication	225745	0.0821
5	Retail	208795	0.0759
6	Arts, entertainment, recreation & other services	175720	0.0639
7	Accommodation and food services	161695	0.0588
8	Production	152675	0.0555
9	Agriculture, forestry, And fishing	148845	0.0541
10	Transport and Storage (inc postal)	123075	0.0448

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