A recent House of Commons report compiling business statistics since the turn of the millennium has shed some interesting light on how things have changed over the last 14 years. The number of private sector businesses has grown from some 3.4 million to just over 5.2 million and of those the vast majority are SMEs, perhaps suggesting that we are becoming more entrepreneurial and confident about starting out on our own.
UK Business Growth – Small Business is Thriving in the UK
In 2014 there were over 5.2 million small businesses in the UK with over 5 million of them designated as micro businesses, meaning that they employed 9 staff or less. Not only that, those 5 million businesses accounted for some £1,647 billion’s worth of turnover and employed 60% of the workforce in the UK.
There is no doubt that SMEs today contribute a large amount to the overall economy though the number actually employing staff has dropped by 8%, from a third to about a quarter, since 2000. Large businesses (those employing more than 250 people) still account for majority of employment and 53% of the turnover.
Most regions in the UK (except Scotland which saw a slight fall) have seen an increase in the number of businesses created and the area that have seen the biggest rises are, London and the South of the country.
- Over 4.5 million of SMEs are based in England with Wales, the nearest ‘competitor’, having claim to just 213,000.
- The majority of these businesses operate in the service industry (73%) followed some distance behind by construction (18%).
- The two biggest areas within the service industry were retail, as you would expect with greater access to online shopping, at 10% and the scientific and professional industries that came out at 15%.
Another interesting statistic is the creation and cessation of trading of companies which has remained fairly constant over the years since 2000. The number of businesses that started trading in 2014 was 346,000 compared to the 238,000 that stopped trading, and birth rate seems to have moved significantly ahead of death rate in recent years. In London alone 84,000 businesses started in 2014 and 50,000 stopped trading.
Female Bosses with a Growing Influence
Whilst the number of women who are involved in running SMEs has grown over the last decade or so, the statistics show that there is still some way to go before they reach parity with their male entrepreneurial counterparts.
In 2012, the estimates were that around 18% of SMEs were female-led, a figure that was slightly higher (19%) for companies that actually employed staff. This equates to something around 860,000 SMEs that have a significant female-led profile. Many of these were newer ventures perhaps suggesting that women are starting to make more of an impact when it comes to starting up a business.
Companies that are equally led by both a female and male accounted for a further 23% of SMEs which means that some 42% of small to medium sized businesses in the UK have a significant female led involvement. The number of women taking an active part in total early stage entrepreneurial activity (TEA) still lagged significantly behind their male counterparts at 5% and 10.2% respectively.
The better news is that the number of female members on the boards of companies has continued to increase over the years meaning that there is more chance of equality in representation. For the first time, in 2014, there were no all-male boards in the UK.
You can find more details of female involvement on the boards of companies in the Cranfield School of Management Female FTSE board report which also lists the FTSE 100 companies by the number of female board members. Although a fair few of these seem to be ‘honorary’.