Companies House figures collated by the Centre for Entrepreneurs have revealed that 2014 was a record year for new companies formed across the country, with a total of 581,173 businesses registered with Companies House, beating the 2013 record by almost 50,000, and up just shy of 100,000 on 2012.
The report, commissioned by Startup Britain, also revealed the UK’s most entrepreneurial cities. Unsurprisingly London leads the way, with over ten times the new business of the second place city, Birmingham. A total of 184,671 new firms were registered in Greater London in 2014, almost a third of the national total. The report shows increased entrepreneurial activity in regional cities, perhaps indicating that the UK’s economy is becoming less London-centric.
The top ten startup cities in the UK in 2014 were:
- Greater London – 184,671
- Birmingham – 18,337
- Manchester – 13,054
- Brighton – 8,344
- Glasgow – 8,173
- Bristol – 8,130
- Sheffield – 8,052
- Nottingham – 7,641
- Warrington – 7,529
- Edinburgh – 7,480
Luke Johnson, Chairman of the Centre for Entrepreneurs, commented on the record year for new businesses:
“Starting a business is easier, quicker and cheaper than ever thanks to new technology.
“Entrepreneurs have higher profiles than in the past and are seen as role models. Traditional jobs for life have largely disappeared, as have occupational pensions.”
Although they provide a good barometer of overall trends in the economy, there are several problems with using Companies House data to infer new business activity. The largest group of business owners – sole traders – are not included in Companies House formation statistics.
Similarly, the location of these new businesses is questionable given most small businesses use their accountant as their registered address. According to the raw data BN3 – where we’re based – is the seventh most entrepreneurial postcode in the entire country. In fact, we are artificially inflating the figures by allowing clients to use our address on Companies House.
Regardless, the new statistics should be seen as a positive for the UK economy.
Photo by Mike Kniec