Despite a very public narrative surrounding the steep downturn experienced by the UK economy in the year of the pandemic and beyond, the figures relating to entrepreneurship and founder motivations may provide a far more enlightening view. According to data from the University of Kent, UK business incorporations were up 30 per cent in the four weeks to mid-December compared with the same period last year. This partnered with a 12% increase in new businesses starting up during 2020 compared to 2019 would indicate that the old adage is true: we are a nation of shopkeepers, advancing our independent ventures irrespective of Covid-19.
As SMEs account for three fifths of employment and around half of turnover in the UK private sector, the increasing growth trajectory of start-up numbers is encouraging news for economic recovery. With the Bank of England forecasting a major up-surge in the second half of 2021, the collective of businesses will possesses optimal conditions for growth. Due to the issues faced in the last year, business owners possess a raft of risk planning and disaster recovery experience yet unseen in any generation of business founders; this may ensure a resilience that will likely support their potential for survival and growth in the future.
Whether in the wake of the pandemic, or during the near-critical uncertainty caused by Brexit, UK entrepreneurialism and sensibility has risen above the challenges presented. It must be supported by the Government, the investor community and industry peers to ensure the system is stacked in favour of unwavering founder enthusiasm.
Founder and Principal Consultant of Cornerstone Tax, David Hannah:
“The UK is a nation of shopkeepers who have shown their resilience throughout a year that has brought financial hardship and have still been able to make it out the other end. There has been a huge amount of discussion around potential recessions but this period is totally different to any previous recession and business owners and consumers alike know this.
This year these SMEs have shown their resourcefulness with many having a big uptick in revenues. From working with a plethora of small businesses across the country, I have been able to talk to the owners and have found that even they feel that they will see an increase in business and expect to see growth going into the new year. There of course will be a transition period, but overall, 2021 looks like a year when business owners will look to capitalise on their adaptations without as much disruption.
We have seen SME growth over a year plagued with a pandemic and financial unrest, so I believe that small businesses will adjust to whatever the trading reality is. The UK just needs to support its small businesses through this period and then we will be sure to see them grow and flourish in the next quarter.”