Numbers of small UK businesses continue to rise
26 08 2005 United Kingdom
Latest figures for the Department of Trade and Industry show an increase of nearly 260,000 small businesses in the UK, the highest year-on-year increase in the last ten years.
The DTI’s estimates published yesterday show an estimated 4.3 million businesses in the UK at the start of 2004. This compares with an estimated 4.1 million at the beginning of 2003.
- 99.3 per cent were small businesses with less than 50 employees.
- 26,000 were medium-sized with between 50 and 249 employees
- Only 6,000 were large businesses.
Secretary of State at the DTI, Alun Michael, said: "Not only do small and medium-sized businesses account for 99.9 per cent of the business population, they employ 12.9 million people and contribute more than £1.2 trillion in turnover.
"We must continue to support new and existing businesses, and ensure that they are at the forefront of our efforts for encouraging a sustainable entrepreneurial culture.”
A spokesman for the Federation of Small Business said: “These figures do not let the government off the hook from the accusation that red tape is stifling job creation in this country. Taking on the first member of staff remains a bureaucratic nightmare for entrepreneurs and tackling red tape must be at the top of the government’s agenda for this parliament.”
Employment
At the start of 2004, small enterprises alone accounted for 46.8 per cent of employment, a very slight rise on the figure a year earlier.
There are an estimated 2.72 million sole proprietors in the UK, and 12 per cent of them have employees. 37 per cent of partnerships have employees and over 60 per cent of the UK’s 1 million companies have employees.
Turnover
Small enterprises accounted for 37 per cent of private sector turnover, a drop from 38.3 per cent in the previous year. There are variations by industry, with small manufacturers accounting for only 18.3 per cent of turnover in the industry as a whole.
Very small enterprises with no employees had an estimated combined turnover of £190 billion, an increase of £12 billion compared to the previous year.
topenterprise commentary
The DTI’s report reflects the fact that 2003 was a record for start-ups in the UK. In that year, according to Barclay’s, nearly 465,000 new businesses commenced trading.
The net increase of 260,000 reveals that over 200,000 small businesses closed down during 2003.
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