News

October 19, 2012

2012 sees record number of private sector businesses in UK

The number of private sector businesses in the UK increased to 4.8 million at the start of 2012 – a record high. This figure is up from 4.5 million businesses at the start of 2011.

Despite the tough economic conditions, BIS says that the estimated number of private sector businesses in the UK has increased in each of the past 12 years. Since the start of 2000, the number of private sector businesses has increased by 1.33 million and is now at the highest level since 2000.

Private sector companies in the UK are predominantly small firms — 99.9%, according to BIS, are classified as SMEs. These statistics, published by the Department for Business, Innovation and Skills (BIS), also show:

• the 4.8 million private sector businesses employ an estimated 23.9 million people and have an estimated turnover of £3,100 billion
• SMEs also account for 59.2% of private sector employment and 48.8% of private sector turnover

Business minister, Michael Fallon, said: “We have always said that the private sector is central to healing and rebalancing our economy, and this increase is another encouraging sign. We know that our entrepreneurs drive growth, so we will continue to do everything we can to help unleash and unlock entrepreneurs’ potential.”

The majority (62.7%) of private sector businesses are sole proprietorships, 28.0% are companies and 9.3% are partnerships, according to the findings.

Micro-businesses — those employing nine people or less — are playing an increasingly important role, accounting for 96% of all SMEs in the UK. Between 2011 and 2012, the number of micro-businesses rose by 250,000. In fact, the survey shows that businesses with no employees account for 74.2% of all private sector businesses in the UK.