How important are small businesses to the UK economy?
Well, if the research recently conducted by Direct Line for Business (DL4B) proves to be correct, then the answer is very important. What’s more that importance is set to increase over the coming months as small businesses across the UK look to expand. That can only be good news for the UK economy as a whole, and, as such, it’s an initiative that every accountant will welcome.
So what does this latest small business say? Well, DL4B’s study, carried out by Consumer Intelligence, surveyed a sample of 401 UK start-ups with up to 10 employees and discovered that over the course of the next 12 months they, in conjunction with 400,000 home-based businesses who were looking to hire their first employee, were expecting to create up to 1.9 million new jobs. DL4B estimates that this could boost the UK economy by as much as £27 billion a year.
So what sort of terms and conditions will these new roles attract?
Well, DL4B’s research indicates that new employees hired by small firms this year will be expected to work an average of 28 hours a week, while start-ups planning to hire their first employee are looking for someone to work an average of 21 hours a week. Average wages for new employees working for small and micro businesses will be somewhere in the region of £14,405 per annum, while self-employed firms employing a staff member for the first time expect to start them on £10,795 per annum.
Where will most of these new jobs be located? Well, whilst London and the South East will unsurprisingly attract most of the new jobs, the South West and North West will also be attracting their fair share. DL4B’s research showed that regional SME recruitment plans in the London area were the “most proactive” with more than two-fifths (41%) of start-ups anticipating hiring new staff this year. However, the South West and North West were also actively recruiting new staff and hoped to take on 35% and 31% respectively over the course of the next 12 months. Interestingly DL4B also found that female entrepreneurs were more likely to recruit new staff than their male counterparts, with 33% of female business owners claiming to be actively looking to expend their workforce, as opposed to 26% of male employers.
Speaking about the survey, Jasvinder Gakhal, head of DL4B, said:
“Small businesses are the lifeblood of our economy, employing millions of people, and our research shows that they are set to contribute significantly this year. With positive signs of economic growth, many businesses will want to take advantage by expanding – often by increasing headcount.”
Are you looking to start up your own business, or aiming to expand your existing small business in the next few months? If you are then Steven Glicher accountants are here to help you build your business and turn it into the success it deserves to be. Our accountants can offer a range of core business start-up services, from tax planning, business structure, raising finance and business planning, to company formation, book keeping, business growth and VAT registration. For further information contact Steven Glicher accountants on 0161 485 8007 or email firstname.lastname@example.org.