Small business survey shows steady progress

The most representative survey of the UK small business sector has revealed that nearly half of those questioned were producing new products and services, the highest level since the survey began in 2003.

The 2006/07 Annual Small Business Survey released by Department for Business, Enterprise and Regulatory Reform (BERR) also revealed 65 percent of small businesses with employees had ambitions to grow for the coming years, representing a nine percentage point increase on the previous year.

The survey confirmed what ministers recently discovered when they met over 600 small business owners around the country.

Releasing the survey, Business Minister Shriti Vadera said: "The positive findings - of businesses intending to grow and introducing innovation - are indicators of a healthy enterprise environment, but the survey also highlights continuing challenges.

"We recognise that regulation is a key business concern and this is why we are driving through one of the most ambitious programmes to ease the burden of regulation on business launched by any government."

The survey also showed that women continue to be significantly under-represented in enterprise, with only 14 percent of small businesses with employees led by women.

Shriti Vadera said: "Getting more women into business is a challenge, not just for gender equality but for national economic success. We would have 700,000 more businesses if proportionally as many British women as American women started businesses.

"We will unveil an enterprise white paper next month to help unlock the talents of more people, make growing a business easier and narrow the productivity gap between Britain and the US."

Key findings from the Annual Small Business Survey produced by the Department for Business, Enterprise and Regulatory Reform include:

• There was a 16 percentage point increase in the proportion of SMEs with employees engaged in innovation of products and services (48 percent compared with 32 percent in 2005).
• 65 percent of SMEs were planning to grow over the next two to three years (up from 56 percent). One in five SMEs had taken on more employees in the 12 months prior to the survey while one in seven had reduced the size of their workforce.
• More than half of SME employers (60 per cent) had funded or arranged staff training or development over 12 months prior to the survey. In 2005, that figure was 41 per cent.
• The vast majority of SMEs with employees were led by men; only 14 percent were led by women or by a management team mostly comprised of women. Female led SMEs with employees tended to be smaller than average.
• When asked to suggest the biggest obstacle to success, SMEs named competition as the greatest barrier (15 percent); regulation (14 percent); taxation including VAT, PAYE, NI and business rates (12 percent); the economy (10 percent); and cash flow (10 percent). For the most part, the obstacles cited and their rankings are comparable with those reported in 2005.

by: Editor
03rd Mar 2008