Business is still thriving
Dec 2 2008 by Peter McCusker, The Journal
THE number of businesses in the North East rose by more than 2,000 last year – the highest annual rise in start-ups in the region since records began in 1994.
New Government figures show the region’s business stock stood at 52,275 at the beginning of 2008 almost 9,000 more than when new start-up figures were released 13 years ago.
The North East also had the highest percentage increase in business stock of any region outside London – a 4.1% increase compared with 2.9% for the UK. However, whether the North East can sustain its growth is subject to speculation with insolvencies up about 40% year on year.
Recent figures from national insolvency and recovery firm Begbies Traynor also showed the number of companies in the region rated as “critical” – with County Court Judgments totalling £5,000 or more – for the third quarter of 2008 is 451, compared to only 77 a year ago.
While 2008 is proving to be a challenging year for entrepreneurs the latest figures have been welcomed by the region’s business community.
In the late 1990’s regional development agency One North East set a target of seeing the region create between 18,000 and 22,000 new businesses by 2016. Last year The Journal revealed that for a region this size we should have around 70,000 businesses.
A One North East spokesman said: “These new figures show the North East is a fertile region for business creation, experiencing a faster than average growth rate in the number of businesses for each of the last five years.
“This underlying strength of the North East business base means we are in a strong position to weather the economic downturn which has impacted the region in the latter months of 2008 and which is likely to continue throughout 2009.”
Alastair MacColl, chief executive of Business & Enterprise North East, which provides the region’s Business Link services said: “I am sure that even during this difficult economic climate, businesses in the North East will demonstrate the resilience and sheer determination that is needed to survive and indeed thrive.”
The figures which have been released by the Department for Business Enterprise and Regulatory Reform showed that 5,790 new North East business registered for VAT in 2007 while 3,515 de-registered.
Colin Stratton, Federation of Small Business regional chairman for the North East, said: “The fact that the region has seen such a growth in the last year points to the North East’s entrepreneurial spirit which is as strong and buoyant as ever.
“The FSB is hearing very few reports of struggling businesses, in fact feedback points to booming industries and successful entrepreneurs.”
