New research has tipped London to lead the way in terms of economic value, although Northern cities aren’t to be underestimated in their own contributions.
A new study by the Hampshire Trust Bank in partnership with the Centre for Economics and Business Research (CEBR) has suggested that the UK’s SME’s will have increased their economic contribution to £217bn between 2015 and 2020.
London small businesses contributed the most in 2015 (£149bn), followed by Manchester (£12bn) and Birmingham (£6bn). London will also see the highest increase in SMEs, from 444,880 in 2015 to an anticipated 534,035 by 2020.
The research analysed the UK’s top 10 cities and found that small businesses will increase their value add by an average of 11% by 2020. However Northern cities will be able boast a decent contribution to the UK economy too, with Leeds and Manchester predicted to boost their value add to the economy by 15%. Mark Sismey-Durrant, chief executive at Hampshire Trust Bank, said:
“Our report demonstrates the critical importance of SMEs as the engine room of the economy. Their sizeable contribution to the fortunes of the UK economy – growing to 27% of total business contribution by 2020 – cannot be ignored.”
Sismey-Durrant also highlighted the importance of the upcoming Autumn Statement. While the only small business rumours for this term’s statement revolve around updates on the Making Tax Digital initiative, Simsey-Durrant is urging the government to “keep the spotlight on smaller companies by creating conditions which will support their continued growth.”
Nina Skero, managing economist at CEBR, said: “This study demonstrates there is a positive story to be told about the UK’s SMEs and it is encouraging to see such strong growth being mirrored outside of the capital.
“We expect the importance of SMEs to the country’s economy to increase in the coming years and hope this research will inspire business leaders across the UK to invest in their growth strategies.”