The UK is in need of a stronger pipeline of new businesses to offset the economic value being lost as established firms leave the market, according to the latest Cynergy Bank Business Births and Deaths Index.
The Index, based on the latest ONS data for January to June 2026, shows new businesses generated £47.8bn in turnover during H1, while businesses that closed accounted for £51.2bn.
The £3.3bn gap suggests that the current flow of new firms are not yet sufficient to replenish the revenue and productive capacity being lost as established businesses leave the market.
Jobs data reinforces the pressure on business creation
The same pressure was visible in employment. New businesses created 411,962 jobs in the first half of 2026, while closures accounted for 459,463 jobs lost, leaving a net employment deficit of 47,501.
The shortfall comes as the UK labour market continues to show signs of softening, with falling vacancies and more cautious hiring plans. This further highlights the importance of new business creation, with today’s start-ups forming part of the employer base that could help offset jobs lost through business closures and strengthen labour market resilience.
Sector data reveals areas of resilience and pressure
Despite the challenging backdrop, Cynergy Bank’s Business Health Score*, which measures the ratio of new businesses created to those lost, reveals that some sectors are still finding room for growth.
Real estate was the strongest-performing sector in H1 2026, with a Business Health Score of 1.23 and a net gain of 1,300 businesses, reflecting resilient demand in the property market.
Education recorded a Business Health Score of 1.16 and a net gain of 410 businesses in H1, suggesting continued demand for training, skills and learning services as businesses and workers adapt to a changing economy.
At the other end of the scale, agriculture recorded the weakest sector score at 0.59, with 1,180 more businesses closing than opening. Wholesale also contracted, with a Business Health Score of 0.79 and a net fall of 1,165 businesses, while production recorded a score of 0.83 and a net decline of 1,155 businesses.
Nick Fahy, Chief Executive of Cynergy Bank, said: ‘Start-ups have always been one of the UK’s greatest economic strengths. They create jobs, bring fresh ideas to market and help drive long-term growth.
‘If the UK wants a stronger pipeline of new businesses, entrepreneurs need an environment that encourages them to take the leap. That means ensuring ambitious founders can access the support and finance they need to turn an idea into a sustainable business and create the foundations for future growth.
‘Access to finance, practical support and strong banking relationships all have a role to play in helping more businesses get off the ground and establish themselves in their early years.
‘At Cynergy Bank, we see first-hand the ambition that exists within the UK’s entrepreneurial community. Through relationship-led banking and our Human Digital approach, we help businesses access this support and grow with confidence.’
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