The number of new businesses started in the UK increased by 14 per cent in the last year despite the impact of the Covid-19 pandemic, outpacing the global average of a 6 per cent increase in business start-ups.
A study by UHY, the international accountancy network, shows that there were 726,000 new businesses created in the UK in 2020 compared to just over 636,000 in 2019.
Data from HMRC also shows that in March 2021 more new businesses were created than in any other month since records began in 1989.
UHY says furlough and people being forced out of work due to the pandemic has led to “a wave of entrepreneurialism” in the UK.
Martin Jones, partner at UHY Hacker Young, said: “Entrepreneurs in the UK have really used the pandemic and lockdowns as a springboard to start businesses. It’s exciting to see British people find the positive in the last 18 months. The entrepreneurial spirit in the UK is undimmed.”
There has been a particular increase in online retail businesses. In the second quarter of 2020 – the peak of the first lockdown – an average of 4,613 new online retail businesses were set up in the UK each month.
This figure was up 66 per cent from the average per month in 2019 (2,783).
In January of 2021, online spending as a proportion of overall UK retail spending also hit a record high of 36 per cent – almost double pre-pandemic levels.
“We now look back on the last Global Financial Crisis as a period where many of the UK’s leading fin-tech businesses were started. In a decade it’s likely we will see the pandemic period as a similarly crucial period for entrepreneurialism,” Jones concluded.