Just one per cent of UK businesses are foreign-owned but account for a quarter of output

Only one per cent of registered businesses in the UK business economy in 2011 were foreign-owned but these businesses contributed 28 per cent of gross value added, says a report from the Office for National Statistics (ONS).

One reason for this is that foreign-owned businesses are more likely to be bigger in terms of employment and, on average, bigger businesses add more value to the UK business economy.

Businesses with fewer than ten employees were least likely to be foreign-owned. The 0.5 per cent that were contributed five per cent of value added. This is in contrast to large businesses (where over 250 people are employed), where 28 per cent of registered businesses were foreign-owned and provided 40 per cent of value added.

The majority (53 per cent) of foreign-owned registered businesses in the UK Business Economy were European-owned. America (North and South combined) had the second highest share in ownership, at 34 per cent. In terms of value added, Europe and America accounted for 50 per cent and 40 per cent respectively.

Production saw the largest contribution from foreign-owned registered businesses at three per cent, contributing some 46 per cent of value added. This contrasted to the construction sector, which has the smallest proportion (0.3 per cent) of foreign-owned businesses - although they contributed seven per cent of value added.

Regardless of industry sector, the contribution of foreign-owned registered businesses to value added was larger than their contribution to the number of businesses. This is in part explained by the kinds of activities being undertaken by businesses within the industry sectors.