Britain’s small business sector is booming, according to new figures, as the number of new businesses grew by 200,000 last year to reach almost four million.
New figures published today by the DTI’s Small Business Service (SBS), show there was a net increase of around 200,000 firms operating in the UK in 2003 compared to the previous year – equivalent to over 500 new businesses starting up every day.
The figures are the highest year on year increase in business numbers since the statistics were first collected in 1995.
The proportion of national turnover and employment generated by SMEs also increased from last year to its highest level in five years. They now account for 99.8 per cent of the business population, with an annual turnover of £2.2 billion, and employ over 12.6 million people.
The overwhelming majority of SMEs are businesses with up to 49 employees, accounting for 99.2 per cent of last year's total. Some 26,000 medium-size companies - up to 249 employees - represented 0.6 per cent of the population and 6,000 enterprises with more than 250 workers made up the balance.
The smallest firms provided work for 46 per cent of the 21.7m-strong labour force and represented 52 per cent of the £2,200 billion turnover generated by the 4m businesses.
Almost 3 million businesses were effectively one man bands, highlighting the growing trend towards self employment for everyone from IT professionals to plumbers as well as the increasing ease of working from home. But these ‘micro businesses’ still contributed £178 billion to the UK economy.
Enterprise minister, Nigel Griffiths, said the growth highlighted the Government's commitment to small business. But business owners struggling with an increasing hostile tax regime and the growing mountain of regulation, legislation and red tape emanating from Westminster might take issue with him.