Marginal rise in numbers of new businesses during 2008, says latest report

25 03 2009 United Kingdom

Following the record number of new businesses in 2007 the start-up rate levelled off in 2008, Barclays’ latest report shows.

Figures released by Barclays reveal that the total number of businesses in England & Wales increased by 1 per cent to just under 2.9 million firms at the end of 2008. Although start-up activity weakened in the second half of the year, the overall results were higher than forecast six months ago, when numbers were expected to drop very sharply.

Barclays’ estimate covers ‘mainstream’ start-ups in England & Wales, based on small firms operated through a business current account and the bank’s market share.

In terms of percentage growth, women entrepreneurs outperformed men in starting new businesses. Female-only starts ups increased by 9 per cent in 2008 - 90,000 new businesses compared to 83,000 in 2007. Male-only start-ups showed a slight increase of less than 1 per cent.

Steve Cooper, local business managing director at Barclays said: "It appears women more than men are bucking the downturn by starting a business."

"These figures may seem surprising given the current economic climate,” he said. “There could be a number of reasons for the robust start-up market, including individuals made redundant opting for self-employment."

At a regional level there were contrasting fortunes. Start-up activity increased by 8 per cent in Yorkshire and 6 per cent in the East Midlands, but the number of new businesses declined by 6 per cent in Wales and 3 per cent in the South West.

There is some reflection of the economic trends over the past year in the pattern of start-ups during 2008. New property service firms fell by 13 per cent and there was an 8 per cent decline in businesses associated with construction. In contrast, start-up activity in the area of health, education and social work increased by more than 13 per cent.

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