SME business numbers skyrocket
The number of small and medium sized businesses (SMEs) has skyrocketed in the UK.
The Government now estimates that there are 5.7 million private sector businesses at the start of 2017 and 99.9% of these companies were SMEs.
This represents an increase of 197,000 businesses set up since the start of 2016 and a whopping 2.2 million since 2000.
That’s an increase of 64% in 17 years.
Estimates released by the Department of Business, Energy and Industrial Strategy also reveal some interesting facts about the make-up of firms in Britain and how they shape society.
SME companies accounted for 60% of all private sector employment in the UK and combine turnover for all SMEs represented 51% of the total private sector turnover.
At the start of 2017, there were 1.3 million businesses that employed at least one other person and 4.3 million non-employing businesses. This means that 76% of businesses didn’t employ anyone apart from the owner.
Since the millennium, the majority of growth in private sector businesses has been in non-employing businesses – accounting for 89% of the overall increase.
More people are choosing self-employment and the trend looks set to continue, with non-employing companies representing 79% of the 197,000 overall increase last year.
Around 60% of the total business population were sole proprietorships, 33% were companies and 7% were ordinary partnerships.
In the last year, the number of companies and sole proprietorships increased by 7% and 2% respectively – but the number of partnerships fell by 2%.
Commenting on the figures, Federation of Small Businesses (FSB) National Chairman Mike Cherry said that the UK’s entrepreneurial spirit was “not easily shaken”.
He continued: “Despite rising costs and flagging consumer demand, we still have ever more people taking the brave and exciting step of starting a small business.”
Miles Grady, Director of Cloud Accountant said: “These figures are very impressive, particularly considering the risks that entrepreneurs take on these days.
“They reflect a monumental shift towards self-employment that is driving real innovation and change in Britain. The government deserves some praise for its work encouraging small business growth, but looming tax changes threaten to unmake much of their progress.”