The share of turnover controlled by the largest businesses within UK industries has declined over the past 15 years, according to new official statistics examining how economic activity is distributed between companies.
Research published on 13 October by the Office for National Statistics shows that the turnover-weighted average share held by the five largest businesses within individual industries fell from 45% in 2010 to 38% in 2025 across the non-financial business economy.
The findings provide a new measure of changes in the structure of British industries, although lower concentration does not necessarily establish that competition has increased or that smaller businesses face fewer barriers to growth.
The ONS calculated concentration using information from the Inter-Departmental Business Register, with additional estimates from the Annual Business Survey. Its new dataset covers 2007 to 2025 and examines the proportion of turnover accounted for by businesses within detailed industry classifications.
The principal measure is known as the five-firm concentration ratio, or CR5, which records the combined share of an industry’s turnover generated by its five largest businesses. The national figure is calculated by weighting each industry according to its turnover, giving economically larger industries greater influence on the average.
A second measure, the Herfindahl-Hirschman Index, considers the market shares of all businesses in an industry, giving greater weight to those with larger shares. The ONS found that its turnover-weighted average declined from 1,075 index points in 2010 to 700 in 2025.
Both indicators suggest that turnover became more evenly distributed within industries over the period, although the most substantial decline occurred between 2014 and 2017. Average concentration has subsequently fluctuated around the levels established towards the end of that interval.
The changes also varied considerably between industries. Mining, energy and utilities remained the most concentrated broad grouping, with an average CR5 of 66% in 2025, down from 77% in 2010. The relatively high figure reflects sectors in which infrastructure, capital requirements and the scale of operations can favour larger businesses.
Manufacturing concentration was comparatively stable, with its average CR5 standing at 56% in 2025. Construction remained the least concentrated broad grouping, recording an average of 14%, consistent with an industry containing numerous businesses operating across different locations and specialist activities.
Business and consumer services, including wholesale and retail trade, professional services, and information and communications, recorded average concentration of 36% in 2025. The corresponding figure had been 44% during the early 2010s before declining later in that decade.
Within individual sectors, the differences can be more pronounced. Electricity and gas supply recorded particularly high concentration, while real estate activities had one of the lowest measures. These variations demonstrate why an economy-wide average cannot describe the competitive conditions experienced by every company.
Industry concentration is one indicator used to examine market power, but it has limitations. Businesses assigned to the same statistical industry may supply different customers or geographical markets, while companies classified separately can sometimes compete for the same expenditure.
The ONS also notes that production technology and business structure influence concentration. Some activities require substantial fixed investment, and larger operations may achieve efficiencies that would be difficult for smaller competitors to replicate. A concentrated industry is therefore not automatically evidence of ineffective competition.
Conversely, lower concentration does not establish that new entrants can easily compete. Smaller businesses may still face obstacles in accessing finance, skilled employees, distribution networks and customers, even where the largest companies account for a smaller share of total turnover.
The headline figures are also influenced by developments in individual high-turnover industries. Changes in the distribution of activity within those sectors can affect the weighted national average more substantially than similar movements elsewhere in the economy.
The ONS has designated the publication as official statistics in development, reflecting continuing work to refine its approach. The underlying business register includes organisations registered for VAT or PAYE but does not capture every very small business or self-employed worker.
Further assessment of prices, profitability, business formation and market entry will be needed to determine how far the recorded changes correspond to stronger competition. The new figures nevertheless establish that average UK industry concentration in 2025 was lower than during the early 2010s, with most of the reduction occurring several years before the latest reporting period.
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