The number of people launching businesses in the UK has risen by more than 5% since last year, despite the hugely challenging conditions facing firms, according to analysis of ONS data by digital bank Starling.
The surge in entrepreneurialism is evident in nearly every part of the UK, with Wales seeing a huge 99% increase in new companies launched, compared to the same period last year (6,070 vs 3,055)
Starling looked at the ONS’ Business demography statistics for Q3 and found that 4,805 more firms were founded in the three-month period of this year compared to 2019. While Wales was head and shoulders above other parts of the UK, only three regions saw a fall in new businesses – the East Midlands, the South East and the East of England (illustrated in the table below).
|Businesses started Q3 2019||Business started Q3 2020||Percentage change|
|Yorkshire and the Humber||5685||6055||6.5%|
The data also showed the impact that Government lending schemes have had on rescuing firms in trouble, with the number of ‘business deaths’ across the UK during this period falling by more than 7% since last year. This trend is particularly prominent in Wales and the North West, where 24% and 22% fewer companies respectively, folded in Q3 this year compared to 2019.
Starling’s analysis also shows the different fortunes of specific industries during the pandemic. The number of new businesses launched in accommodation and food services is down 62% on last year, while new firms in arts and recreation are down 59%. Conversely, new companies falling into the bracket of business admin and support services are up 143%, and new wholesale ventures are up 44%.
Anne Boden, CEO and founder of Starling Bank said, “The pandemic has given many people time. Time to develop an idea, formulate a plan and action it. It is this kind of resilience which will really bolster the UK economy when we start to ease out of lockdown which is why enabling SMEs to open new business accounts has been so critical during this time.”
One entrepreneur who started a business during lockdown is Aina Gomez who was running a successful photography company before the pandemic started. Reduced revenue from the company caused Aina to launch Razzmatazz Oxford, a theatre school for children aged 4-18 which has been a huge success.
Aina said, “My daughter inspired me to launch theatre school because I could see she was suffering without her friends. I felt the same, having had a sociable job and a busy life before lockdown so for me it was a great opportunity to do something different. It was daunting, but Starling made the admin easy and I was fortunate enough to get a great response from friends and family and the business has steadily grown. It energises me, gets me up in the mornings and makes me happy and this I am grateful for.”