New business registrations in June reach record high, as ‘COVID economy’ companies emerge
A record number of new business formations in June offset a major drop in registrations during lockdown and suggests the beginning of an entrepreneurial recovery. These are some of the findings from analysis of Companies House data by the Centre for Entrepreneurs.
Business formations dropped year on year by 19 per cent in March, 29 per cent in April and three per cent in May, before growing 47 per cent in June.
All regions and devolved nations saw growth in June, with London and the West Midlands leading with 60 per cent increases.
The devolved nations experienced the sharpest fall in formations during lockdown and the slowest recovery in June. Scotland and Northern Ireland are down nearly 20 per cent year on year, while Wales is down 11 per cent.
Despite these major drops, overall start-up figures between March and June are down by only three per cent.
Matt Smith, director of policy and research at the Centre for Entrepreneurs, says: “June’s growth in business formations suggests entrepreneurs’ confidence has returned and that many new ideas developed during lockdown are now being implemented.”
There is evidence of the emerging ‘COVID economy’, with major increases in disinfecting services (400 per cent), manufacture (243 per cent) and retail (317 per cent) of medical goods, manufacture of workwear (227 per cent), wholesale of pharmaceuticals (196 per cent), manufacture of cleaning preparations (178 per cent), specialised cleaning services (85 per cent) and research on biotechnology (69 per cent).
Consumer businesses have also increased significantly, including 13,904 new internet retail businesses (up 110 per cent), as well as growth in sports retail (89 per cent), games and toys retail (89 per cent), computer retail (99 per cent), bakeries (58 per cent) and clothing retail (53 per cent).
Oliver Pawle, chairman of the Centre for Entrepreneurs, says: “With many businesses set to close and unemployment rising, it is entrepreneurs that will drive Britain’s much needed economic recovery and create new jobs.
“These figures provide reassurance that there is a ready supply of new ideas and growing sectors across the UK.”
