Medium Sized Businesses are Economy’s Real Heroes
New research from the CBI shows that the medium-sized businesses are the unsung heroes of the UK economy…
Business group the CBI has new research to show that, whilst they may not be household names, the UK’s medium-sized businesses (MSBs) are the ones that have done a lot of the "heavy lifting" during the economic recovery.
Employing between 50 and 499 people, medium-sized firms have contributed significantly to job creation and growth across the United Kingdom.
The data from the CBI shows that between March 2010 and March 2013, the UK’s MSBs created 185,000 jobs, a 4.1% increase and better than smaller firms (1-49 employees) with a 2.8% increase and the biggest companies only increasing jobs by 1.9%
Whilst they only make up just 1.8% of the UK private sector, the nation’s medium-sized firms employ 4.7 million people which is 16% of the UK’s total workforce.
Turnover for the country’s unsung heroes equates to between £10 million and £100 million per firm meaning that MSBs have contributed over £300 billion gross added value to the UK economy. This equates to 23% of total private sector revenue.
Looking regionally at medium-sized businesses, they contribute more than their fare share in different parts of the country. In the East Midlands they account for just 1.9% of the businesses there but they generate 20% of the region’s revenue. In the North East of England, 2.2% of the private sector firms are MSBs but here they turnover 48% of the region’s private sector revenue.
As well as contributing to the economy, the nation’s medium-sized businesses are particularly upbeat about the next 12 months with 82% of firms expecting the economic outlook to improve whilst 88% anticipate their own business growth.
John Cridland, the CBI’s Director-General, said of the latest figures:
“Despite making up less than 2 per cent of the private sector, they [medium-sized businesses] now employ 185,000 more people than in 2010 and contribute more than £300 billion to the economy.”
“This hugely positive picture is reflected up and down the country where MSBs are major local employers, in many cases helping to offset public sector job losses during the downturn.”
The Director-General was not only encouraged by the findings but was especially upbeat about the future prospects for the middle-sized firms in the UK;
“These firms are optimistic and want to make the most of the recovery. With the right help from the Government their future growth potential could be even greater.”
“With better access to a range of growth finance options, improved training and research support, and help to break into new exports markets – these firms could be worth an extra £20 billion to our economy by 2020.”
The CBI’s full findings can be seen in their local champions campaign pages, and in their report Future Champions – Unlocking growth in the UK’s medium-sized businesses.