Emma Jones says the boom in company formations in the first half of the year is a bright spot for the economy
Emma Jones CBE is the founder and chief executive of small business network and business support provider Enterprise Nation.
Inflation remains elevated despite June’s figures showing a slight contraction, and continues to cast a shadow over the UK economy.
But before we descend, spare a few moments to look on the bright side – almost half a million new start-ups were registered with Companies House in the first six months of this year.
It’s a trend that’s not being crushed by economic indicators or inflationary pressures. And even if only a tiny handful of these companies become the fast growth Unicorns of the future, it’s good news for us all.
We’ve been studying this surge in start-up companies for many years. In 2015, the UK hit a record half a million in 12 months. Eight years later we are getting there in six months.
The Enterprise Nation Startup Tracker dynamically tracks new companies and found 431,060 businesses were registered in the first six months of 2023 to the end of June, with 78,997 companies registered last month.
This boom in start-ups reflects an ongoing trend in entrepreneurship. 784,762 businesses were registered at Companies House in 2022, that’s almost 30,000 more than in 2021. In 2019 670,575 businesses were registered. And on we go.
Why? We know from our own research that a third of all UK adults were thinking about starting a business at some point this year. Yes, some of that was about boosting earnings in a cost-of-living crisis, but quite a lot of it was about giving back, job satisfaction and monetising skills.
It’s also about awareness. Among the digitally savvy Gen Z, that figure rises to almost half (48 per cent) who said they wanted to start a business. That could be anything from personal training to selling second hand clothes on Depop.
That’s a whole generation that can now expect a career that not only has multiple jobs, but also multiple businesses and side hustles in what could look like a very different future.
But don’t just take our word for it.
According to another recent report we did into the amount of accessible space available to entrepreneurs, we found a 22 per cent increase in demand for co-working spaces, with regional growth particularly strong in northern cities like Leeds and Manchester.
And in our communities, entrepreneurs are powering our high streets because now 63 per cent of the stores and restaurants nearby are now independent.
As we head into the busy second half of 2023, what those individuals need is to get the right kind of support to help them efficiently achieve what they set out to do, and that is to share their knowledge, add value to their communities and use their talent to bring in more cash.
Often entrepreneurs have brilliant, life changing ideas, they just need support to develop a clear plan and help to navigate some of the hurdles that can often derail a business. I mean support with things like budgeting for example, or understanding cash flow and using digital tools to increase productivity and efficiency.
StartUp UK, a programme developed by Enterprise Nation and Monzo Business is already helping many start-ups develop key business skills in their own time, online.
So far this year the free programme has reached 165,000 small business owners with its webinars, e-learning modules and support.
This kind of ‘always on’ style of support is becoming increasingly important, especially for disadvantaged entrepreneurs but also for the increasing number of women starting a business in the UK.
According to the most recent Global Entrepreneurship Monitor report, one in ten women are already in the early stages of starting a business – it’s an historic high.
Sceptics will say these figures don’t reflect the true picture. We admit, they have not been balanced by the number of insolvencies, for example. But from our experience, having the experience of working for yourself is intoxicating.
It opens up a whole new world of possibility, not just for the entrepreneurs involved, but for us all.
And that is worth celebrating.
