UK sees business surge: 101 new businesses created every hour in 2023

With a remarkable surge in businesses, the entrepreneurial spirit across the nation has rebounded despite economic challenges.

According to a recent study by iwoca, one of the largest small business lenders in Europe, 101 new businesses have been created every hour across the United Kingdom during the first half of 2023, despite our current economic challenges.

Compared to the same period in 2022, when 402,000 businesses were formed, the data indicate an impressive 9% increase.

There are 1,768 new businesses per 100,000 people in London, and Camden leads the pack among all London boroughs with 13,646 new businesses per 100,000 residents. The number of companies increased by nearly 3,500 from the previous year. 

Additionally, Hackney (6,383) and Islington (6,241) ranked among the top three, illustrating London's entrepreneurial dominance.

In the North West, a total of 612 new businesses were registered per 100,000 residents, moving up from third to second - and in the West Midlands, the runner-up dropped to third with 574 businesses.

For the second consecutive year, Scotland ranked last on the list, with only 365 businesses per 100,000 residents. Unfortunately, the North East fared no better, ranking second-to-last with 376 businesses per 100,000 residents. Overall, though, there is a positive atmosphere among entrepreneurs and small businesses, and there is always room for improvement.

The signs of self-employment are encouraging

Despite a decline in self-employment in 2020 and 2021, the trend shifts in 2022, with sustained increases suggesting a revival of entrepreneurial spirit.

By the end of 2022, the UK had 4.39 million active self-employed individuals, an increase of 154,000 compared to this time in 2022.

In the first quarter of 2023, 43% of the 738,000 job moves were caused by resignations, an increase from the 40% reported in 2022. There has been an increase in individuals venturing into entrepreneurship this year as opposed to staying in traditional employment.

Despite high inflation and economic uncertainty, Iwoca Chief Operating Officer Seema Desai expressed optimism for business growth. 

She said: “This will be vital for the country’s economic growth over the next few years, and is a huge vote of confidence in the UK as a place to do business,” and that the data “shows the spirit of entrepreneurship is strong across the whole country”.

As a result of this surge in business creation and the Government's recent commitment to investing £1 billion to support these new businesses, the UK's economic growth is likely to continue in the coming years. This indicates a strong vote of confidence in the country as a business hub.