2020 was a pretty gloomy year for the wider economy. Millions of workers were forced to do their working from home, and millions more were forced to put on facemasks and abide by dozens of anti-contagion measures. But from this period of adversity, one of the encouraging trends has been the willingness of furloughed workers to set up new ventures of their own.
Depending on which data you believe, around 80,000 extra businesses were set up in 2020 compared with 2019, which amounts to a rise of around 12%, year-on-year. This is the highest growth surge on record. Much of this surge was concentrated in the period between June and August, where nearly 60,000 new businesses were registered.
Which Sectors Saw the Biggest Increase?
Research from business-card company instantprint reveals that the retail sales sector is by far the largest source of new businesses. More than 22,000 businesses of this kind were set up – beating management consultancy and real estate into what amounts to joint second place, on around 16,800 each.
Where Are the Start-Ups to Be Found?
You might have read about an exodus from London’s city centre to the outskirts, prompted in part by the reduced importance on being able to actually get to work in the city. Despite this very real phenomenon, London is still by far and away the most popular city for new registration, with more than 123,000 of them.
This a figure which dwarfs those of second-place Birmingham (11,185) and third-place Manchester (around 9,684).
When Were the Start-Ups Established?
The instantprint data confirms that the boom in registrations took place over July, peaking at 52,281 over the course of the month. January, conversely, was the least busy month, with just 25,403 registrations reported. Of course, some of this trend might be attributed to seasonal factors that would be present even in a normal year – but it’s still an impressive surge.
What Does the Future Hold?
Many respondents to the polling reported that they hadn’t opened a business – but that they had plans to start one in 2021. For 18%, these plans were ‘firm’; for a further 29%, they’re just being ‘considered’. Encouragingly, it’s millennials who are the likeliest demographic to want to make a business happen, which suggests that the future shape of the economy will be more about freelance work and smaller, more agile businesses, policed by a handful of tech giants.
Laura Mucklow, Head of instantprint, was quick to predict that we’d see start-ups forming a significant pillar of the post-covid recovery. “Judging by results of our survey, 2021 looks to be another booming year for start-ups and we’re keen to see what the new year brings.”