Publications that covered this story include: The Daily Mail and City AM on 27 September 2016. This publication was also covered in Sky News 28 September 2016.
- Number of UK businesses tops 2.1 million for the first time
- Millennials starting their own businesses help drive rise
According to our research, the number of businesses in the UK has hit an all-time high of 2.1 million, up 4% from 2 million last year, as the national start-up economy continues to thrive.
The number of businesses in the UK per capita has also virtually recovered to its pre-crunch level of 32.8 businesses per 1,000 population – it currently sits at 32.7 businesses per 1,000 population.
Britain’s thriving start-up economy is behind the rise, with an increasing number of entrepreneurs choosing to start their own businesses. Many of these new companies are founded by millennials in their twenties and thirties. Last year, our research showed that there were 26,420 companies with a director aged 21 or under.
The UK’s ease of doing business, for which it is ranked 6th out of 189 countries by the World Bank, as another reason for the increase in the number of companies. For example, in the UK, entrepreneurs can incorporate companies in 24 hours, and the UK has the lowest Corporate Tax rate in the G20.
The UK government also offers a range of grants, loans and tax reliefs for entrepreneurs. These range from innovation vouchers, which subsidise business advice for SMEs and start-ups, to Entrepreneur’s Relief, which reduces capital gains tax for entrepreneurs looking to sell their businesses.
Marc Waterman, partner, says: “The UK’s thriving start-up economy has driven the number of businesses to its highest ever level.”
“The recession showed that working for big business is no longer a guarantee of job security.”
“In this environment, the UK Government is aware that a large proportion of millennials want to start their own businesses, and has put a range of schemes in place to support new companies. This has given young people the confidence to strike out on their own.”
“In the past, many would-be entrepreneurs might have thought that starting their own business was too risky, opting for the security of a full-time job. This is no longer the case.”
However, the government is jeopardising this by continuing to add to the costs businesses face. These include:
- the national living wage;
- auto-enrolment pensions; and
- the threat of having to report more regularly to HMRC.
Number of businesses in the UK tops 2.1 million for the first time
Number of businesses per 1,000 population virtually back to pre-crunch high
* Year end 31 March 2016. Source: VAT registered businesses.