Small is really beautiful – and so productive
Apr 22 2008 By The Journal
SMALL businesses are often described as the life blood of the North East economy. When you look at the figures, it’s no wonder they are seen as so important: more than 99% of the UK’s 4.3 million businesses are classed as small or medium sized enterprises.
In the North East, Government figures show that 77% of firms have nine or fewer employees compared to the national average of 82%, while 95% of firms in the region have fewer than 50 staff compared with the 96% national average.
The North East Chamber of Commerce (NECC) says small entrepreneurs are helping the region to catch up with other areas which have had stronger track records on creating small businesses in the past.
Andrew Sugden, NECC director of membership and policy, said: “There is a growing vibrancy in the North East economy that is having a tremendous impact on what have been historically low levels of small business creation.
“Rising levels of enterprise will see SMEs become even more important to the growth of the regional economy over the coming years.”
The Federation of Small Businesses (FSB), a membership group that exists to lobby on behalf of small firms, says that smaller enterprises are currently the engine of the economy.
Colin Stratton, the FSB’s North East regional chairman said: “Small businesses really drive the economy at the moment. As small businesses, we are proud to be independent, we take the risks, provide employment to others and support the economy.”
He pointed out that smaller firms are responsible for more than half of the UK’s GDP and said that more than 60% of innovations are made by small enterprises.
However, Mr Stratton said that if small businesses were to continue to thrive, they must have the support of local people. He pointed to the FSB’s
Keep Trade Local campaign, which aims to persuade more people to use their local shops and services.
Nationally, the FSB says that 2,000 local shops are closing each year and it warned that if the situation continues at its current rate, then there will be no independent retailers left by 2015.
“Our present concern is the decline of the high street, partly due to the strength and the competition of the large supermarkets which are causing the demise of small businesses,” Mr Stratton said.
“It does not help when local authorities are introducing more parking charges in the high streets when out of town parking is generally free.”
