By Claire West
Britain’s economic recovery is being led by the nation’s small businesses with 204,361 new businesses opening in the first half of 2010 according to The Yodooo Green Shoots of Recovery Report.
The figure, based on Companies House data, represents the largest number of new businesses to open in the UK for over a decade, marking a surge of new openings since the UK officially came out of recession in January 2010. The report reveals how the recession has spurred many people to set up their own businesses; with the UK seeing a 51 percent increase in the number of businesses opening their doors compared to the same period in 2008 when the UK first went into recession.
Tony Heywood, CEO of Yoodoo.biz comments: “The recession left many people out of work or unhappy in work and it is these people that are now using their own initiative to set up their business and help kick-start the economy again.
“Many of these people are not serial entrepreneurs; but instead are normal hard working people who have decided that they want to make a difference to their lives. It’s important that the Government recognises the growing impetus around the country for people to try entrepreneurship for the first time. The administration must offer these people the practical support and motivation to ensure that they can make their new businesses a success and encourage more people in similar positions to set up their own businesses, too.”
A new found resilience
New businesses that were formed in the recession are also showing signs of a greater resilience to the tougher economic conditions. Only 0.6 percent of businesses founded in 2009 have gone into receivership or liquidation compared with an average of 4.5 percent of those businesses set up between 2000 and 2008.
Heywood continues: “The old adage that the majority of new businesses go bankrupt in their first year of trading is simply no longer true. The report confirms that the recession has created a new generation of kitchen table entrepreneurs who are setting up companies based on leaner business models, enabling them to adapt to realities of the new economy.