06/12/2010
Small firms are essential to future growth in employment, a new report says.
According to research conducted by information services provider Experian, of all the jobs that were created in the UK by small and medium businesses in the last 10 years, 4.4 million were created by less than 10 per cent of these firms.
Experian's report identifies that some small businesses have 'champion' characteristics and these high-growth companies were responsible for creating two thirds of all the jobs within the small and medium sized enterprise community.
The study claims that identifying and developing potential champions will be key to driving the UK's economic growth. Whilst some SME's may consider the cost of advertising for new staff to an expense they cannot currently afford, invoice finance services such as factoring are one way small businesses can get the necessary funds to invest in new staff.
The research revealed that the north-east and the Midlands are some of the least resilient areas of England, with the healthiest levels of future champions. In addition, the report advised that support should not necessarily focus on specific industries as champions can exist in all sectors.
Charlotte Hogg managing director of Experian UK and Ireland told Start Ups: "All eyes are on private sector SMEs to drive growth, but encouraging them to take the risks associated with growth at a time when they are focusing on survival will be a challenge."
"Our analysis tells that less than 10 per cent of SME firms have created millions of jobs in the last decade. The challenge for government is how to identify budding 'champions' and give them the support they need, while still helping support the rest of the SME population who are the bedrock of the economy.
Hannah McLaverty-Williamson