Business leaders estimate losses of over £300,000 revenue per year due to lack of foreign language proficiency  – London Business News | London Wallet

UK businesses are paying a high price for their reliance on English as the default language of global business.

A new study reveals that UK business leaders estimate they are losing an average of over £300,000 in revenue annually due to language barriers – a silent cost now being dubbed the “Translation Tax”.

This is according to a new study of 2,500 workers, including 500 business leaders at UK companies that operate internationally, from DeepL, a leading global Language AI company.

Despite all surveyed companies operating globally in some way, 87% of workers say language differences cause challenges, with nearly half (47%) experiencing it at least once a week.

Over half (53%) of UK business leaders who have experienced challenges admit that their company has not maximised international growth potential because of language barriers, and 57% say that these challenges are directly affecting negotiations and commercial outcomes.

UK business leaders surveyed the most common challenges created by a lack of language proficiency are customer support (34%), IT related issues (33%) and training (26%). In fact, 65% of business leaders admit lack of language proficiency makes communication with global customers challenging.

However, language-related challenges are leading not only to external issues, but also internal ones. 54% of workers say that language barriers are creating internal communication challenges between offices and teams in different countries. There’s an increasing feeling that UK companies have double standards, despite operating internationally, as 41% of workers say it is not encouraged to speak other languages internally. So much so that 57% of UK professionals feel ‘embarrassed’ that international colleagues are expected to switch to English.

53% of business owners surveyed acknowledge that colleagues who don’t speak English fluently are at a disadvantage. Although nearly three-quarters (73%) of business leaders surveyed are given the opportunity to learn new languages, language inequality remains deeply entrenched. Language barriers aren’t just philosophical – they’re having a measurable impact on work. 59% of UK professionals surveyed say their performance has been negatively affected by language difficulties. For workers aged 18-24, that number rises to 65%. Despite this, only four in ten professionals are turning to AI to help navigate these challenges.

David Parry-Jones, Chief Revenue Officer at DeepL, underscored the urgency of adapting to a multilingual business environment: “While English remains the dominant language of international business, fluency is limited to just 20% of the global population. This study highlights a crucial reality: relying solely on English for external and internal communications can restrict market expansion and impactful team collaboration for UK companies.

“The financial impact of this overreliance – what we now recognise as the ‘TranslationTax’ – is too significant to ignore. In response, UK businesses are increasingly embracing AI to overcome these barriers. Our research shows that 72% plan to integrate AI into daily operations, and 60% agree that AI translation tools have had a positive impact on international operations.

“As global commerce becomes more interdependent, the UK’s reliance on English is becoming less of a competitive advantage and more of a liability. If British businesses are to unlock their full international potential, they will need to move beyond linguistic convenience and invest in multilingual fluency – both human and artificial.”