Recession – what recession? Oh, that recession.
The number of new businesses created in Britain was 70,000 fewer this financial year than in the previous 12 months – a fall of 16 per cent. Latest figures from corporate services company Jordans show that many of the major gains of 2006 have not been maintained. They suggest that the slow down started around September and coincided with the first effects of the credit squeeze.
The North West of England experienced the largest percentage fall of 46 per cent year on year followed by the South East of England – outside Greater London – where the total was 26 per cent less. The drop also topped 20 per cent in Yorkshire and Humberside. Other regions fared better but still saw a fall except for Scotland, where there was no change, and the North of England, where the number of new companies formed went up by 2 per cent.
Paul Townsend, Director of Jordans Corporate Services, said there was a mixed picture for 2007-08 compared to the almost universal rises of the previous year when a 20 per cent rise took the total to almost 470,000. Much of the increase that year was due to the change in the Government’s tax treatment of managed service companies, many of whom formed private limited companies instead. Townsend said that although the latest total was down, new enterprises were still being formed at an average of more than 31,000 every month. (Although whether 95% of these were Polish owned plumbing companies is another matter.)