Summary
- There were 5.9 million small businesses at the start of 2020.
- Compared with the previous year, the private sector business population increased 1.9% (+113,000 businesses).
SMEs and the Economy:
- At the start of 2020 there were 5.94 million small businesses (with 0 to 49 employees), 99.3% of the total business. SMEs account for 99.9% of the business population (6.0 million businesses).
- SMEs account for three fifths of the employment and around half of turnover in the UK private sector.
- Total employment in SMEs was 16.8 million (61% of the total), whilst turnover was estimated at £2.3 trillion (52%).
- Employment in small businesses (with 0 to 49 employees) was 13.3 million (48% of the total), with a turnover of £1.6 trillion (36%).
Composition of the business population:
- In 2020, there were estimated to be 6.0 million UK private sector businesses
- 1.4 million of these had employees and 4.6 million had no employees.
- The UK private sector business population is made up of 3.5 million sole proprietorships (59% of the total), 2.0 million actively trading companies (34%) and 414,000 ordinary partnerships (7%) in 2020.
- 2.6 million private sector businesses as registered for VAT or PAYE, 45% of the estimated total population.
Trends in the business population
- Between 2019 and 2020, the total business population grew by 113,000 (1.9%).
- Between 2000 and 2020 the business population increased by 2.5 million (+72%), with the highest rate of increase was +7% between 2003 and 2004, and between 2013 and 2014.
- There was a decrease in the business population (for the first time in the series) between 2017 and 2018 of 27,000.
Locations and industries
- Nearly a fifth of all SMEs were operating in Construction, compared with less than 1% in the Mining, Quarrying and Utilities sector.
- Professional, Scientific and Technical Activities accounted for 15% of all SMEs, while 9% were in the Wholesale and Retail Trade and Repair sector.
- London (1.1 million) and the South East (932,000) had the most private sector businesses, accounting for 35% of the UK business population, while the North East had 163,000 private sector businesses, the least of any English region.