Helped by ‘millennials’ in their 20s and 30s, entrepreneurship in the UK is flourishing, with the business population hitting a high of 2.1 million.
The figure is up by four per cent from two million last year and takes the number of businesses in the UK per head 1,000 of the population – almost equivalent to its pre-recession level of 32.8 businesses.
The study, by accountancy firm UHY Hacker Young, suggests that millennials in their 20s and 30s are one of the key drivers behind the UK’s booming start-up economy.
Last year it was revealed that there were 26,420 companies in the UK with a director aged 21 or under.
Sceptics say the start-up surge has been due to established companies downsizing staffs and opting for ‘outsourcing’ – with work sub-contracted to former staff, thus saving on pension, sick pay and holiday costs.
While this has undoubtedly contributed, there is also plenty of evidence to suggest many who have been made redundant in company slimdowns greatly prefer the freedom and opportunity presented by working for their own businesses rather than opting back into salaried employment.
Another reason for the increase in enterprise is thought to be the ease of doing business in the UK: out of 189 countries, the UK is ranked sixth by the World Bank, for enabling entrepreneurs to incorporate companies in 24 hours and for having the lowest corporate tax rate among the world’s leading G20 economies.
UK businesses also benefit from a range of grants, loans and entrepreneurial tax relief offered by the government.
Said Marc Waterman, partner at UHY Hacker Young, “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.”