Paddington area, London. July 2022.Image by Tim Sandle
A study of the contribution smaller sized companies make to the workings of the British economy has been undertaken. This is an important consideration given the proportion of firms that fall within this range and the extent that such companies have been ignored by government policy in recent years. Small and medium businesses make up more than 25 percent of all businesses in the U.K.
These businesses that employ between one and 249 employees contribute more than £2 trillion in turnover and employ 44 percent of the British workforce.
With this proportion, different parts of the U.K. vary in terms of numbers. Northern Ireland has the highest percentage of SMEs out of any region, at 25 percent. Scotland has the second-highest percentage of SMEs out of all the UK regions, with 27.7 percent of all businesses being SMEs.
Similarly, some sectors have a high proportion of smaller players than big companies. For example, smaller firms dominate hospitality industry, making up 68 percent of all businesses.
Out of the 200,645 businesses operating in the industry, 140,050 are small or medium-sized, which equals roughly 69.8 percent. The Hospitality Industry is made up of accommodation and food services including hotels and restaurants.
Research into small businesses comes from the marketing training hub School of Marketing. The institution analysed the latest government data on the number of small and medium enterprises in 2021 to see which regions and industries are powered the most by SMEs.
The industry with the second-highest percentage of SMEs is Wholesale and Retail Trade. This industry, which also includes mechanic shops that repair motor vehicles and motorcycles, has more than 500,000 businesses, and more than four in ten (43 percent) are small or medium-sized.
Real Estate Industry has the third-highest proportion of SMEs, with 35.4 percent of all enterprises having below 250 employees. The industry has 134,095 businesses operating in the UK, and 47,740 are small or medium-sized.
In fourth is the Agriculture, Forestry and Fishing Industry, which has more than 150,000 businesses running in the country, and roughly 50,000 (33 percent) are SMEs.
The industry counting the fifth-highest percentage of SMEs is Manufacturing, with 32 percent of the enterprises operating in this industry being small or medium-sized, which is 87,210 out of the 270,000 businesses.
The study also assessed the most in-demand skills for entry-level positions across a range of industries and found that Communication and Microsoft Office proficiency are the most commonly occurring skills on job adverts – both appear in 61 percent of the jobs that were analysed. The third most in-demand skill is a High Attention to Detail, appearing in 44 percent of ads for entry-level positions. Finishing off the top five is a tie for fourth between Time-Management and Self-Motivated, both showing up on 39 percent of job adverts.
Commenting on the findings, Ritchie Mehta, CEO of School of Marketing tells Digital Journal: “There are more than 1.4 million British companies which employ between one and 249 people, and combined they turn over a massive £2 trillion every year, which is 45% of total turnover from UK businesses. It’s essential that they are not only given the support to grow and continue making such an important contribution, but also that there is a skilled workforce able to help them deliver and adapt to the demands of an evolving economy.
He adds: “This data shows that when it comes to skills, there are some common themes that employers are looking for across a range of jobs, however in the current climate, budgets for training are likely to be cut, and the skills gap could widen. SME owners can take advantage of the Apprenticeship Levy scheme to bring in new staff or train current ones in digital and data-led programmes, with the vast majority of the training cost covered by the levy.”