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’Forgotten middle’ outperforms counterparts
The South East’s army of 4,895 mid- sized businesses is creating more employment than its same size counterparts in any other region of the UK, outside London.
According to new research from Grant Thornton, mid-sized businesses in the South East – which incorporates much of Hampshire, East and West Sussex, Kent, Buckinghamshire, Oxfordshire and Surrey – created 609,000 jobs in 2013.
The region’s mid-sized businesses are also outperforming their geographical peers financially. Grant Thornton’s study shows the turnover of mid-sized businesses in the South East is five times that of the turnover of all mid-sized businesses in Wales. It’s nearly double the amount turned over by firms in the same size bracket in Scotland too.
The research forms part of Grant Thornton’s new ’Agents of Growth’ report, which also showed:
• In the South East in 2013, mid- sized businesses turned over £99,831 million, an increase of 2% on last year’s figure and an increase of 5% on 2011’s statistic.
• The South East has a high number of mid-sized businesses compared to its counterparts in different regions. London has the most (5,765), followed by the South East (4,895), and then the North West (3,610).
• The number of MSBs in the South East has increased by 3% from 2012 to 2013, despite the contraction of the economy. The South East’s mid-sized business population has expanded more over the past year than any other size of business. In fact, the number of small enterprises fell in the South East by -2% from 2012 to 2013. The number of large enterprises rose slightly in the same period by 2%.
• The South East’s closest competitors when it comes to employment creation are the North West, where mid-sized businesses created 436,000 jobs in 2013, and the West Midlands, where 349,000 were created in the same period.
• Mid-sized businesses in the South East are more productive than their small enterprise counterparts, and had a turnover per head of £163,926 in 2013, compared to small firms’ turnover per head of £113,062. Large enterprises are still the most productive, turning over £225,338 per head.
Norman Armstrong, partner at Grant Thornton’s Southampton office, said it is further evidence that mid-sized businesses are the region’s, and the UK’s, ’secret success story’, strongly outperforming smaller and larger companies and driving economic growth.
He said: “What’s clear from this research and wider conversations from our ’Agents of Growth’ summits nationally is that there is potential for these MSBs to significantly boost the UK economy. We could see the UK emulate the successful German Mittelstand.“
“It’s often the ’forgotten middle’, yet when you look at the segment in relation to its larger and smaller counterparts, its importance in driving UK economic recovery is crystal clear. The shape and size of these businesses has meant they were able to navigate the economic storm of recent years better than the rest of the market, and have made the most of the few growth opportunities that were out there. Impressively, they’ve been doing so with relatively limited government or peer support, and with little recognition of their efforts.“
The ’Agents of Growth’ report found that overall MSBs contributed £270 billion to the UK economy in gross value-added terms, almost the equivalent of the real estate (£158b) and financial services (£108b) sectors combined.
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www.businessmag.co.uk 12/11/2013 16:12
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