While 2020 may not have felt like an obvious year in which to launch a new business, the UK’s entrepreneurial spirit appears to be undiminished. The latest data on start-up businesses suggests we are well on the way to matching the record 673,000 new companies registered during 2019. And this year’s start-ups are spread the length and breadth of the country, setting up shop in traditional hotspots for new ventures, but venturing further afield too.
Data from the talent innovation company SHL suggests London has topped the rankings so far this year for new business start-ups. Its analysis reveals 131,000 companies were launched in the capital during the first eight months of the year alone, a 22% increase on 2019.
In second place, Birmingham saw almost 11,700 new launches over the same period, SHL’s data shows, up 21% on 2019, while Leicester is home to 6,400 new companies, a 27% increase. But it’s not only the largest cities that make SHL’s top 10; Droitwich in the Midlands, Waterlooville in Hampshire, and Ruislip in the South-East all have impressive numbers too.
Moreover, when you adjust the data to analyse business start-up rates on the basis of population size, different winners emerge. In separate analysis just published by the flexible workspace company Instant Offices, Portsmouth and Bradford come out ahead of London. Given their size, these cities have produced more start-up businesses so far this year than the capital, Instant Offices’ data shows.
On this analysis, Leicester also scores highly, but other leading lights include Coventry, Wolverhampton and Leeds. Indeed, the proliferation of start-ups tracked by Instant Office is spread across the whole of the UK. Edinburgh, Belfast and Cardiff all make the company’s top 20 ranking of entrepreneurial cities.
John Williams, head of marketing at Instant Offices, says the data is testament to the resilience and agility of the UK’s entrepreneurs. He also believes the Covid-19 pandemic has prompted more people to think about launching their own ventures – perhaps because they have lost their jobs.
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“Despite the uncertainty caused by the pandemic, we could see a record number of new companies launching as entrepreneurs emerge across the country,” Williams says.
“The onset and spread of the pandemic have had a massive impact on the growth of entrepreneurship in the country, with many new businesses having to pivot to survive during the crisis. While the exact implications of Covid-19 on business and the economy at large is still uncertain, the UK’s innovative and entrepreneurial spirit endures.”
SHL shares that view. “Since June, new business creation has exploded,” the company says. “2020 is set to be the best year on record for new business creation in the UK – if the current trend continues, by the end of the year we will see the number of new businesses created, year on year, jump by around 12%, the largest year-on-year percentage rise since 2011.”
However, supporting these businesses through to the end of the pandemic will be crucial. Small business groups point out that the UK Government’s support for self-employed people does not cover those who have set up new businesses, since business owners must be able to produce historic tax returns in order to claim help. It would be a huge shame to lose large numbers of these new ventures before they’ve had time to really get started.