Exports to the US soften under tariff pressures, as financial services and construction thrive in Q4 according to latest UK Trade Barometer
- Manufacturers pivoted most sharply away from America in 2025, targeting Asia, Europe and Australasia
- Financial services had its strongest quarter of the year, with construction businesses booming internationally
- Barometer from Manchester Airports Group and the Growing Together Alliance polls 2,000 businesses about their global trading habits
- Findings covering October-December identify opportunity to boost global trade in regions outside London to kick-start UK growth
British exporters pivoted away from America over the last 12 months, sharpening their focus on European and eastern markets as the year progressed. The shift away from the US was most stark among manufacturers, as they targeted new territories to mitigate the impact of President Trump’s tariffs, according to the latest UK Trade Barometer.
Their order books increasingly featured China, Japan, Australia and several EU nations over the course of the year – a trend that looks set to continue in 2026.
Meanwhile, Britain's status as a services superpower shone through as finance firms recorded their strongest quarter yet in Q4. Not impacted by White House tariffs, America remained a top market, with Canada becoming increasingly important during 2025.
Britain’s strength in supplying construction services was another key trend – the sector consistently recorded the highest percentage of firms reporting export uplifts during 2025 – sales to Japan surged during the year.
Another consistent theme was the gulf between London and the regions when it came to export performance.
That presents an opportunity for Ministers as they look to jump-start productivity through the delivery of the Government’s industrial strategy, according to the UK's largest airports group, MAG.
The UK trade barometer surveys 2,000 businesses across the country every quarter. It is representative of industrial sectors and UK regions.
Run in partnership with YouGov, it asks firms about their global trading habits in the past quarter and their expectations for the quarter ahead.
The Barometer is delivered by MAG - which owns and operates Manchester, East Midlands and London Stansted - alongside the Growing Together Alliance of business groups.
The latest findings cover Q4 and present the first full picture of the whole of 2025:
Stagnant pond
- The shift away from America was seen across all sectors. Just 24% said they had increased US sales in Q4, having fallen progressively from 29% at the start of 2025.
- When asked which global market they had entered for the first time in Q4, 14% said America, down from 20% in Q1.
- Looking forward, 13% of all businesses surveyed in Q4 said they expected to start trading America for the first time in the next three months – the same percentage as in Q1.
- By contrast, nine separate markets have grown sharply in popularity over the past 12 months. In Q4, 10% of firms said the planned to increase sales to Australia (vs Q1: 6%), with Spain (Q4: 6% vs Q1: 5%) and New Zealand (Q4: 6% vs Q1: 2%) also showing gains during the year.
Making waves in different directions
- Nearly half (46%) of all manufacturers said they had increased exports over the last three months in Q4. But only 16% said they had increased sales to America in Q4 – that has fallen from 25% in Q1.
- By the end of the year, 12% of manufacturers said they had grown sales to China, a rate that doubled from 6% in Q1. Japan increased from 4% in Q1 to 8% by Q4.
- It was a similar story when looking at markets manufacturers broke into for the first time. In the first three months of 2025, 15% reported breaking America. By Q4, it was just 8%.
- By contrast, by the end of year 9% of manufacturers said they had sold to China for the first time, up from 4% in Q1. Those saying they’d cracked Japan grew from 2% in Q1 to 9% in Q4.
- Australia also rose in importance, up from 4% in Q1 to 8% by the final quarter.
- Seven different EU states saw strong gains, with France, Germany and Spain become the most popular new European markets by the end of the 2025.
Constructing a new narrative
- Britain is a hotbed of construction skills and that appears to have been one of our strongest exports over the year – in January, 92% of construction firms said they had increased overseas sales
- That fluctuated all year – 64% in Q2; 86% in Q3 and 67% in Q4 – but at an average of 79%, it was the sector that saw the most export increases each quarter
- America started strongly, with 43% saying they grew sales there in Q1 but by Q4, that had dropped to just 18%
- By contrast, just 3% said they increased sales to Japan in Q1, which rocketed to 20% by Q4
- Ireland, Malaysia, Singapore, Thailand and New Zealand saw good increases over the year
At your service
- Financial services had its strongest quarter at the end of the year, with 59% reporting increased overseas sales, up 8% on Q3
- The year started with 25% saying they grew sales to the US and that’s exactly how it ended
- It was the sector with the highest sales increases to India – with 5% saying they grew sales there in Q4, while Canada grew in popularity (Q4: 11% vs Q1: 5%)
Mind the gap
- All parts of the UK had their weakest three months of overseas sales in Q4 – but the gap between London and the regions widened in the second half
- In Q4, 64% of London exporters said they grew overseas sales, compared with 50% in the North, 47% in the Midlands and 44% in the East of England – a 20 percentage point gulf in the most extreme example
- But in Q1just seven percentage points separated London (76% increasing exports) and the North (69%) and there was only a six percentage point gap in Q2 (London – 63%; North – 57%)
- There are also significant gaps in confidence. When asked about the quarter ahead, 44% of London firms expected to grow exports, with 33% expecting to enter a new market for the first time
- In the North, 27% expected to grow sales and 18% to enter a new market. In the Midlands, it was 19% and 13% respectively and in the East of England, it was 18% and 16%
- All regions expect sales to America to bounce back in the first part of this year. In London, 43% expect and uplift in US exports, up from 37% in Q3
- The Midlands had the highest percentage, with 49% expect an increase, up from 30% three months earlier. In the East, 43% expect an American sales increase, up from 34%
- The North was the only region to see fewer firms forecast export increases to America – 46% vs 50% in Q3 – but that was up on the first quarter of 2025, when just 40% expected sales growth
MAG CEO Ken O’Toole said:
“As an island trading nation, we know how important our export performance is to the overall economic health of the UK. This full-year data shows the direct impact global events can have on businesses’ order books – but it also shows that British exporters are skilled at diversifying and pivoting to new markets – harnessing the resilience and innovation of our globally trading firms will be important if we want to kick-start growth.“While some economic indicators point to a potential upturn in growth during the course of 2026, the fact fewer than one in three exporters expect to increase sales in the first part of this year paints a slightly different picture. “As Government looks to deliver its Industrial Strategy, there is a clear opportunity to be grasped: by growing the number of firms that trade globally, we can boost productivity and living standards in regional growth corridors across the UK, from the Northern Growth Corridor to the Ox-Cam Arc. It is vital Government works with business to understand the steps it could take to help more firms trade internationally, including encouraging investment in the infrastructure that unlocks international connectivity.”
Henri Murison, chair of the Growing Together Alliance, said:
"Over the course of 2025 we’ve seen a clear recalibration in UK trade patterns. While America remains a vital market, particularly for manufacturers, exporters have increasingly diversified as conditions have shifted. This reflects geopolitical realities, but also the adaptability and resilience of UK firms. “The pivot to markets like Asia and Europe is notable – and if the Prime Minister can negotiate it then further reduced trade barriers with the latter it would make trade with countries in the European Union easier without allowing accusations of Brexit betrayal that a full-blown customs union could lead to.” “The continued strength of London is welcome, and the priority should now be ensuring that export-led growth is not confined there but supports further increasing productivity across all regions. “With the Spring Statement this week, there is an opportunity to reinforce the economic fundamentals which the Chancellor has focused on. This will allow her to continue backing significant and ambitious growth across the North and OxCam corridors underpinned by infrastructure.”
Regional insights:
London: In the last three months:
- 64% of exporters have increased sales to existing markets
- A 3% decrease on Q3
- Top markets: US (32%), Australia (15%) and France (12%)
- 47% started trading in a new market
- A 2% decrease on Q3
- Top markets: US (18%), Australia (11%) and Japan (11%)
Next 3 months:
- 44% are expecting to increase sales to existing markets
- A 5% decrease on Q3
- Top markets: US (43%), Australia (24%) and Germany (24%)
- 33% are expecting to trade in a new market
- A 1% increase on Q3
- Top markets: Italy (19%), Ireland (16%) and US (13%)
East: Last three months:
- 44% of exporters have increased sales to existing markets
- A 13% decrease on Q3
- Top markets: US (21%), Australia (13%) and Canada (9%)
- 24% started trading in a new market
- A 18% decrease on Q3
- Top markets: US (11%), Switzerland (6%) and Canada (5%)
Next three months:
- 18% expect to increase sales to existing markets
- A 9% decrease on Q3
- Top markets: US (43%), China (25%) and Germany (14%)
- 16% expect to start trading in a new market
- A 9% decrease on Q3
- Top markets: US (30%), France (26%) and India (16%)