Northern cities’ smallest businesses are the least convinced devolution will reach them, Employment Hero research finds
LONDON, 21 October 2026: Northern cities’ smallest businesses are the least convinced that devolution will deliver for them, according to new research from Employment Hero, a global, AI-powered employment platform transforming the way businesses hire, manage, and pay their teams.
SMEs in Leeds and Manchester are broadly optimistic about the government's plans to give regions outside London more powers and funding. Three-quarters (75%) are confident they will lead to practical support for local businesses. But that confidence is concentrated among larger firms. Only 55% of micro-businesses (1–4 staff) are confident of practical support for their business, against 82% of firms with 50–249 staff. Only half (50%) of micro-businesses expect a tangible benefit from devolution in the next 12 months, against 84% of the largest SMEs.
Workers show a similar divide. Only 43% of part-time workers are confident the government's promise of “good growth in every postcode” will benefit their city, against 62% of full-time workers. Self-employed workers are the most sceptical: only 39% are confident in the growth promise, and half (50%) say their city is treated less fairly than London, against a third (34%) of workers overall.
The research, carried out by Savanta among 500 SME decision-makers and 1,500 workers across Leeds and Manchester, comes a week ahead of Chancellor John Healey delivering his first Budget on Wednesday 28 October.
Smallest firms want rates relief, but help to hire is the top ask overall
With the government expected to announce business rates relief for high-street premises, lower business rates is the top ask for the smallest firms. More than half (56%) of firms with 1–4 employees chose it as one of their top three Budget priorities, compared with 31% of businesses with 50–249 employees.
However, across SMEs of all sizes, the most popular ask is support to make hiring more affordable. Almost half (47%) of business decision-makers in Leeds and Manchester chose grants or tax relief for hiring, training and apprenticeships among their top three, ahead of lower business rates (43%) and reductions in employer National Insurance (39%). Three in ten (30%) businesses chose simplified employment rules, while a quarter (26%) chose less employment administration.
Priorities also differ by size. Larger SMEs are more likely to choose support for technology, AI and innovation (44% of firms with 50–249 employees, against 23% of firms with 1–4 employees).
Workers’ priorities overlap with businesses’. Asked what the government should prioritise to build a stronger local economy, they put more affordable housing first (64% chose it in their top three), followed by supporting local independent businesses (55%) and more apprenticeships and skills training (53%).
“There’s a clear gap between what the smallest businesses expect from devolution and what larger firms believe it will deliver. Small businesses are the backbone of our local economies, but they’re also the ones with the fewest resources to navigate new schemes or access funding.”
Kevin Fitzgerald, UK Managing Director, Employment Hero
Help with business rates would be welcome news for high streets, but across businesses of every size, what they want most is help with the cost of taking people on and training them. If support is going to reach every business, it needs to be as simple for a five-person firm to use as it is for one with 200.
Research methodology
Employment Hero commissioned Savanta to survey 1,500 workers living in Leeds and Manchester, and 500 senior decision-makers at small and medium-sized businesses based in Leeds and Manchester. Fieldwork took place between 24 September and 5 October 2026.
Business figures by size are based on 78 micro-businesses and 201 businesses with 50–249 employees. Worker figures by employment type are based on 1,140 full-time employees, 284 part-time employees and 76 self-employed workers.
About Employment Hero
Employment Hero is a global, AI-powered employment platform transforming the way businesses hire, manage, and pay their teams. Its intelligent Employment Operating System uses HeroAI to automate HR, payroll, recruitment and employee engagement.
