Reinventing British Business – Winning Medals for Entrepreneurialism
Sean Farrington, UK MD and RVP Northern Europe, QlikTech, outlines how the UK economy isn’t faring that badly after all
It was recently the five year anniversary of the credit crunch, since which, house prices have fallen, consumer confidence has plummeted and prices and unemployment have risen. Tied in with GDP growth figures, the UK economy doesn’t look that healthy. Or does it?
There is reason to be optimistic as, all across the country, armies of small businesses and entrepreneurs are shoring up our economy. Based on our analysis of business creation and dissolution since 1988, the past two years under the coalition Government have seen 370,000 net new businesses set up than compared with the last two years of the Labour Government (47,800).
So, despite all the negativity around our economy, it looks like the UK is actually reinventing itself. Things are better than we assumed and it’s time to learn from the past and ensure our businesses can continue to achieve greatness and be the ones growing our economy.
Let’s look firstly at political influence – as already mentioned, more businesses have been created in two years under the coalition Government than in the two final years of the Labour Government. One could assume that this is due to the financial crisis hitting when Labour was in power, but we are still said to be headed for a triple dip recession.
Is it a coincidence that the likes of Tech City and Silicon Roundabout have emerged in the last two years, backed by major encouragement from the coalition Government? That depends of course on what types of businesses have been created – well, since the beginning of the 2000s, it has been predominantly technology and knowledge intensive industries such as IT, management consultancy and software development that have come to the fore. I’ll leave you to draw your own comparisons here.
Secondly, let’s have a look at the analysis of Companies House data on business creation and dissolution, overlaid with fuel prices, interest and exchange rates and GDP data sourced from the Office for National Statistics and the Treasury. While increases in fuel duty are widely bemoaned in the business community, the app actually shows they in fact have very little effect on business creation. And the same can be also said for changes in corporation tax.
Entrepreneurs deserve medals
So, maybe businesses and entrepreneurs are going it alone? They are casting off the shackles that government policies, taxes and other potential influences may have on business creation and defying the negativity surrounding the UK economy.
Research from Legatum Institute has recently shown that economic prosperity isn’t the only factor tied to a nation’s ability to win medals in Olympics Games. In fact, the researchers claim that the level of entrepreneurship in each society is also a key measurement. So, taking in account Team GB’s medal haul in the London 2012 Olympics last year, this could be a good indicator of our entrepreneurial spirit and a sign that businesses are thriving despite the downturn! (The fact that the US came top of the medals table further underlines this claim, given the country’s support for entrepreneurs and its numerous success stories over the years.)
Being realistic – data analysis for home truths
We of course recognise that the UK economy isn’t growing as fast as it was, and that the credit crunch has come to bear. With our data analysis, called Discovering UK Growth, we are purely seeking to spot rays of sunshine and help pull out opportunities for entrepreneurs and businesses looking to set up or grow their activities. British business needn’t let up, but can continue to drive our economy, as long as they have the confidence and facts to know how, where and when to set up a business for its best possible performance.
In our opinion, British busines is doing as best it can, reinventing where it can. It’s only by learning from previous experience, analysing data and drawing trends and comparisons that we can continue to drive our economy and give businesses the best footing to succeed.
The more we can focus on the positives, the more British business will thrive as it takes its cue from positive reports in the media and across the industry. And, if ever there was an incentive to succeed, by boosting entrepreneurialism, we might do even better at the next Olympics in Brazil in 2016!