Realising the Potential of SME Automation

The Backbone of the UK Economy

There’s no denying that SME’s make a significant contribution to the UK economy. Indeed, 5.55 million businesses were recorded in the small and medium category in 2023, accounting for the employment of 16.7 million people (about 67% of the country’s total workforce), and generating £2.4 trillion in turnover. And there’s good reason for continuing confidence, with 66% of SME’s expecting sales to increase and a similar proportion reported as being profitable in Spring 2025. 

Of course, there are a variety of challenges for SMEs to overcome, with the cost of business and cashflow pressures being significant for many. There’s a shortage of skilled and unskilled labour, with a clear need to invest in STEM education and inspire the next generation to take up careers, including but not limited to engineering, in the manufacturing sector. Manufacturing should rightfully be seen as offering a diversity of opportunities for interesting and fulfilling work. There’s a significant automation challenge too, with the UK lagging behind more technologically advanced countries.

The Automation Gap

Automate UK’s Manifesto for Automation emphasises that the issue of limited labour is being exacerbated by the failure to fully embrace the benefits of automation. It’s clear in the limited adoption of industrial robots, with a recorded 111 robots per 10,000 employees in 2023. This put the UK 24th on the list in terms of robot density, highlighting the great growth potential. A concerning 35% of business leaders have identified their companies as lagging in the adoption of automation. However, over 20% of SMEs have confirmed their intention to enhance their technology through automation or artificial intelligence over the coming months and years.

Obstacles to Automation Adoption

From the lack of finance to the expected resistance to change, various issues have prevented UK SMEs from making more of a technological investment. International events such as the pandemic have had a major impact, leading to economic uncertainty and the limited availability of funding. There’s a perception that the costs of automation are beyond the reach of SMEs, along with concern over the disruption and shortage of employees with the skills needed to make the most of advanced technologies.

A variety of initiatives and opportunities have emerged for the automation of SMEs. However, there’s an obvious need for a scale-up strategy, ensuring that such businesses have access to finance and support in realising the technological benefits. The misconceived narrative that “robots take jobs” must also be tackled, given the potential to fill vacancies through automation. There’s a clear case for robots taking up roles in the dull, dirty, and dangerous categories, freeing up the workforce for tasks that make full use of skills such as creative problem solving and leadership. Automation also frees up time for key activities, including strategic planning and customer communications.

Innovative Solutions for Automation

As mentioned, there has been a growth in the availability of support and initiatives for SMEs making the transition to automation. For instance, the UK government recently announced £7m in funding to support projects with a focus on realising the benefits of AI integration. 2025 has also seen the introduction of the Business Growth Service, with the aim of empowering the UK’s SMEs through streamlined access to funding, expert advice, and automation opportunities. However, there’s plenty of scope for additional support, with organisations such as Automate UK leading the way.

As Mike Wilson, Chief Automation Officer of the Manufacturing Technology Centre (MTC), has suggested, challenges such as poor productivity, supply chain disruptions and shortages of labour can be taken as the catalyst for increased automation. There should be a commitment to raising the investment in robotics and ensuring that the UK is once again ranked among the top ten manufacturing nations. More training and guidance should be offered, ensuring that SMEs can capitalise on the opportunities of automation.

There’s a clear case for investment in robotics, with the costs of integration falling and various forms of support being offered. For instance, the MTC has introduced a West Midlands Robotics Cluster, opening up opportunities to network and build knowledge of robotics. This could become the model for other robotic centres across the UK. There should also be a focus on such benefits as increased productivity and reduced downtime.

UK SME automation can be further encouraged through:

• Developing resources with guidance on automation options
• Increasing the availability of automation-focused funding
• Fostering partnerships between SMEs and technology providers
• Creating platforms for the sharing of automation success stories.

Discover the Possibilities with Automate UK

Government policy is undeniably key to unlocking the benefits of automation for UK SMEs. However, as the leading trade association for automation suppliers and end users of technology, Automate UK also has a vital role to play. We will fulfil this role through our commitment to industry progress, supporting more informed technology decisions and increasing productivity in the highly competitive international marketplace.

Automate UK’s support for SMEs includes:

• Lobbying organisation and government on key industry issues
• Practical support and grants to help reduce the skills shortage
• Technical support and expertise
• Access to networking, world-class exhibitions, and promotion through our widely-read publications.

Join Automate UK and realise the potential to boost the productivity, efficiency, and growth of your small or medium-sized business with transformative technologies.