Business population estimates for the UK and regions 2022: statistical release (HTML) – GOV.UK

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Published 6 October 2022

© Crown copyright 2022
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This publication is available at https://www.gov.uk/government/statistics/business-population-estimates-2022/business-population-estimates-for-the-uk-and-regions-2022-statistical-release-html
5.5 million
5.47 million businesses were small (0 to 49 employees)
35,900 businesses were medium-sized (50 to 249 employees)
7,700 businesses were large (250 or more employees)
1.5% (82,000 businesses)
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This publication provides the only official estimate of the total number of private sector businesses in the United Kingdom (UK) at the start of each year.
These estimates, produced by the Department for Business, Energy and Industrial Strategy (BEIS), cover a wider range of businesses than Office for National Statistics (ONS) outputs, which report on value-added tax (VAT) traders and pay as you earn (PAYE) employers. See related statistics section for links to ONS publications and Guide to business statistics explaining how each publication differs.
This publication provides information on private sector businesses in the UK at the start of 2022, broken down by number of employees, legal status, industry, and geography. Employment and turnover data are also provided, primarily for use in classifying businesses by employee size band and to calculate shares of employment and turnover across industrial sectors, regions, and legal statuses. Counts of businesses (and associated employment and turnover) are based on businesses’ head office location. A business operating in a particular region/country with a head office located elsewhere is not included in the business count for the English region/country in question.
The publication:
reports on businesses in the private sector
excludes the government and not-for-profit sectors; an overview of the number of businesses in the whole economy is provided in Table 2 of the detailed tables
measures the net change in the number of private sector businesses, but cannot be used to estimate numbers of business start-ups or closures
estimates numbers of private sector businesses by combining estimated numbers of unregistered businesses with data on registered businesses derived from a comprehensive business register (the ONS Inter Departmental Business Register)
comprises this statistical release, a set of detailed tables, a methodology note and data underlying published charts and tables
quantifies uncertainty around key estimates of business numbers
The UK private sector comprises largely of non-employing businesses and small employers, as shown in Table A. SMEs (small and medium-sized enterprises) account for 99.9% of the business population. At the start of 2022:
there were estimated to be 5.5 million UK private sector businesses
1.4 million of these had employees and 4.1 million had no employees
therefore, 74% of businesses did not employ anyone aside from the owner(s)
there were 5.47 million small businesses (with 0 to 49 employees), 99.2% of the total business population
there were 35,900 medium-sized businesses (with 50 to 249 employees), 0.7% of the total business population
a further 7,700 businesses were large businesses (with 250 or more employees), 0.1% of the total business population
Notes for table A:
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The 7,700 large businesses in the UK make a major contribution to employment and turnover. Nonetheless, SMEs account for three-fifths of the employment and around half of turnover in the UK private sector. At the start of 2022:
total employment in SMEs was 16.4 million (61% of the total), whilst turnover was estimated at £2.1 trillion (51%)
employment in small businesses was 12.9 million (48%) and turnover £1.4 trillion (34%)
employment in medium-sized businesses was 3.5 million (13%) and turnover £0.7 trillion (17%)
employment in large businesses was 10.6 million (39%) and turnover £2.0 trillion (49%)
further information on composition is shown in Table 1 in the detailed tables that accompany this publication, and in Figure 2
Note for figure 2
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There are three main legal forms of businesses in the private sector; sole proprietorships, ordinary partnerships, and companies. Sole proprietorships are the most common legal form. At the start of 2022:
the UK private sector business population comprised 3.1 million sole proprietorships (56% of the total), 2.1 million actively trading companies (37%) and 353,000 ordinary partnerships (6%)
1.1 million companies were employers, as were 220,000 sole proprietorships and 95,000 ordinary partnerships
2.9 million sole proprietorships, 932,000 companies and 257,000 ordinary partnerships did not employ anyone aside from the owner(s)
further information on legal form is given in Figure 3 and Table C, and Table 3 of the detailed tables
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Just over three quarters of UK private sector businesses are non-employers, and the majority of these are not registered for either VAT (value added tax) or PAYE (pay as you earn). At the start of 2022:
the Office for National Statistics recorded 2.7 million private sector businesses as registered for VAT or PAYE, 49% of the estimated total population
2.8 million businesses (51%) traded without being registered for VAT or PAYE and are classified here as ‘unregistered’
14% of sole proprietorships and 52% of ordinary partnerships were registered for VAT or PAYE
Between 2000 and 2022:
the business population increased by 2.0 million (59%)
the highest rate of increase was 6.8% between 2013 and 2014, followed by 6.7% between 2003 and 2004
in contrast, the decrease of 1.5% between 2021 and 2022 is only the third decrease in the series, all of which have occurred since 2017. The largest decrease was 6.5% between 2020 and 2021
Between 2021 and 2022:
the total business population decreased by 82,000 (1.5%)
there were 32,000 more (2.3%) employing businesses and 114,000 fewer (2.7%) non-employing businesses
The decrease in non-employing businesses resulted from a decrease of 98,000 (3.3%) unregistered businesses, and a decrease in non-employing registered businesses of 16,000 (1.3%)
the net change in the business population is determined by the balance of new business start-ups and de-mergers (inflows) against those businesses that closed, merged or were taken over by another business (outflows)
further information on trends is in Tables B and C, Figures 4, 5 and 6, and Tables 25 to 28 of the detailed tables
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Growth in the UK private sector business population since 2000 has mainly been due to increasing numbers of non-employing businesses, as shown in Figures 4 and 5. Since 2000:
the number of non-employing businesses has increased by 1.7 million (72%)
the number of employing businesses has increased by 337,000 (30%)
non-employing businesses accounted for 84% of total growth over the period
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Overall the number of SMEs has increased by 2.0 million (59%) since 2000, including 336,000 SME employers (30%). Over this period:
the number of small employing businesses grew by 30%
the number of medium-sized employers grew by 34%
the number of large businesses grew by 7%
In the last year (as shown in Table C and figure 6), the number of companies increased by 16,000 (1%). Sole proprietorships decreased by 66,000 (2%). Ordinary partnerships decreased by 32,000 (8%).
Looking at the period between 2010 and 2022:
the number of sole proprietorships grew by 335,000 (12%) and the number of companies increased by 794,000 (63%)
in contrast, the number of ordinary partnerships fell by 103,000 (23%)
Notes for table C:
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Note for figure 6:
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In terms of employment trends:
total employment across all private sector businesses increased from 27.0 million at the start of 2021 to 27.1 million at the start of 2022, a increase of 0.3%
the SME share of total employment was 61% in 2022
total employment in SMEs increased from 16.3 million at the start of 2021 to 16.4 million at the start of 2022, an increase of 0.6%
further information on employment trends is in Table 28 of the detailed tables
Counts of businesses (and associated employment and turnover) are based on businesses’ head office location. A business operating in a particular region/country with a head office located elsewhere is not included in the business count for the region/country in question.
Private sector businesses are not evenly distributed across the UK. London and the South East of England have considerably more businesses than any other UK country or region of England, as shown in Figure 7. At the start of 2022:
there were 4.8 million private sector businesses in England, 341,000 in Scotland, 219,000 in Wales, and 128,000 in Northern Ireland
London (1.0 million) and the South East of England (844,000) had the most private sector businesses, accounting for 34% of the UK business population
the North East had the fewest private sector businesses amongst English the regions (155,000)
further information on location is in Table 9 of the detailed tables
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For countries and English regions below UK level caution is required in assessment of changes over time due to the level of uncertainty in the estimates (see section “Uncertainty in the business population estimates”).
In the last year:
numbers of private sector businesses decreased by 86,000 in England and by 1,000 in Scotland, whilst numbers increased in both Wales (11,000) and Northern Ireland (4,000)
in percentage terms numbers of private sector businesses decreased by 2% in England and by less than 1% in Scotland, whilst increasing by 5% in Wales and by 4% in Northern Ireland
the number of private sector businesses declined in six of nine English regions
the South East was the English region with the largest numeric decrease (31,000), followed by Yorkshire and the Humber (28,000), whilst the largest percentage increase was in the South West (15,00%)
in percentage terms, the English regions with the largest decreases were Yorkshire and the Humber (7%) and the East of England (4%); the largest increase was in the South West (3%)
changes were driven largely by reductions in numbers of unregistered businesses which are estimated using survey data and therefore subject to uncertainty
further information on regional trends is in Table 26 of the detailed tables
Since 2010:
the number of businesses has increased in all the UK countries and regions
the largest increase, in percentage terms, was in London (44%)
the smallest percentage increase was in Northern Ireland (7%).
further information on regional trends is in Table 26 of the detailed tables
Along with London, the South West, the South East and the East of England the highest business density rates in the UK, based on the size of the resident adult population, as shown in Figure 8. At the start of 2022:
London (1,452) had the highest number of businesses per 10,000 adults. There were also relatively high rates in the South West (1,152), South East (1,134) and the East of England (1,075)
the North East of England had the lowest business density rate (704) of any English region or UK country
Northern Ireland (855), Wales (839) and Scotland (752) had relatively low business density rates compared to the UK average (1,014)
further information on business density is in Table 8 in the detailed tables
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SMEs account for at least 99% of the overall population in each of the main industry sectors and therefore determine the distribution of the business population overall. At the start of 2022:
the largest number of SMEs (914,000 or 17%) were operating in Construction, as shown in Figure 9, compared with less than 1% in the Mining, Quarrying and Utilities sector (32,000)
there were also a considerable number of SMEs operating in the Professional, Scientific and Technical Activities (762,000 or 14%), and Wholesale and Retail Trade and Repair sectors (547,000 or 10%)
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SMEs accounted for 61% of employment and 51% of turnover at the start of 2022. Wholesale and Retail Trade is the industrial sector which has the highest share of both SME employment and turnover, see Figure 10. At the start of 2022:
Wholesale and Retail Trade and Repair accounted for 14% of all SME employment and 34% of SME turnover in the UK private sector
almost a third of SME turnover was spread across three more sectors: Construction (12%), Professional, Scientific and Technical (11%) and Manufacturing (9%)
further information for industries is in Table 5 in the detailed tables
Note for figure 10
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Large businesses accounted for 39% of employment and 49% of turnover. At the start of 2022:
the sector with the most large businesses was Manufacturing (1,200), followed by Wholesale and Retail (1,100), and Administrative and Support Service Activities (1,100)
Wholesale and Retail Trade and Repair accounted for 25% of all large business employment and 35% of large business turnover in the UK private sector
the second largest sector in terms of large business employment was Administrative and Support Service Activities, which accounted for 14% of the total
the second largest sector in terms of large business turnover was Manufacturing, which accounted for 19% of the total
A time series by industrial sector has been published for the first time in this year’s edition (Table 29 in the detailed tables). For estimates by industrial sector, caution is required in assessment of changes over time due to the levels of uncertainty. The publication includes a section quantifying uncertainty around estimates of business numbers by industrial sector (see section “Uncertainty in the business population estimates”).
In the last year:
the greatest numeric increase in businesses was in Transportation and Storge (28,000). The percentage increase was greatest in the Accommodation and Food Service Activities (10%)
the greatest numeric decreases in businesses were in Professional, Scientific and Technical Activities (86,000) and Manufacturing (26,000). The percentage decrease in both of these sectors was 10%. The percentage decrease was greatest in Financial and Insurance Activities (15%)
changes were driven largely by reductions in numbers of unregistered businesses which are estimated using survey data and therefore subject to uncertainty.
the registered business population (which is not subject to the same uncertainty) increased by 16,000 (0.6%). Amongst registered businesses, the sectors Construction, and Wholesale and Retail Trade; Repair of Motor Vehicles and Motorcycles had the largest numerical increases (17,000 and 13,000 respectively). The percentage increase was greatest in Accommodation and Food Service Activities (5%). The sectors Professional, Scientific and Technical Activities, and Information and Communication had the largest numeric decreases (20,000 and 16,000 respectively). The percentage decrease was greatest in the Information and Communication sector (8%)
Since 2010:
the business population increased in all industrial sectors
Administrative and Support Service Activities had the largest numeric increase (165,000). The greatest percentage increase was in Real Estate Activities (66%)
Agriculture, Forestry and Fishing had the smallest numeric increase (2,000)
Construction, consistently the sector with the largest number of businesses (914,000 in 2022), has had the smallest percentage increase (2%), along with Agriculture, Forestry and Fishing (2%)
Numbers of unregistered businesses reported in this publication are estimated, based on Labour Force Survey data. This leads to uncertainty in the total count of businesses in the private sector, which comprises the sum of unregistered business numbers and registered business numbers. Registered businesses are not estimated, being derived from an administrative data source, the Inter-Departmental Business Register (IDBR). IDBR data does contain other sources of error, which are likely to be small for counts of businesses. These are difficult to quantify and not captured in the measurements of uncertainty used in this publication, 95% confidence intervals (CIs) and coefficients of variation (CVs).
CIs indicate a range of values around an estimate within which the ‘true’ value of the estimate is likely to lie, with 95% probability. CIs are the same for both estimates of unregistered business numbers and estimates of all private sector businesses numbers.
CVs, the ratio of an estimate’s standard error to the estimate itself expressed as a percentage, indicate the quality of estimates. The smaller the CV, the more precise the estimate. Values less than 5% indicate an estimate is precise for most practical purposes, those over 20% indicate an estimate is unreliable. CVs differ for estimates of unregistered business numbers and estimates of all private sector businesses numbers, being smaller for the combined total than for the unregistered component.
At the start of 2022, the 95% CI around the total number of private sector businesses, estimated at 5,509,000, was ±107,000. On this basis, at the start of 2022:
there was a 95% probability that the total number of businesses in the private sector was between 5,402,000 and 5,616,000
the CV was 1%, indicating the estimate was precise
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For data shown in Figure 11:
For private sector businesses numbers in England (not shown in Figure 11), estimated at 4,821,000, the 95% CI was ±101,000 and the CV was 1%.
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For data shown in Figure 12:
Table 30 in the detailed tables provides further details of CIs and CVs for all business numbers and unregistered business numbers at the country and English region level, by industry sector, and at the more detailed level of industry sector by country and English region.
The processes used to quantify uncertainty in this publication is described in the section “Accuracy” in the Methodology and Quality Note.
The next publication in this series is scheduled for Autumn 2023.
UK business; activity, size and location, published annually by the ONS, gives information about registered UK businesses broken down by legal status, industry, region, employment and turnover size bands.
Business Demography, published annually by the ONS, provides information on births, deaths and survivals of registered businesses in the UK, by geographical areas and standard industrial classification groups. Business Demography, Quarterly Experimental Statistics has also been published since August 2020.
Small Business Survey reports are published annually by the Department for Business, Energy and Industrial Strategy and detail the performance of small and medium-sized businesses. Reports also contain sociodemographic information about business owners (gender, ethnicity and whether a family business).
Businesses in Scotland, published annually by the Scottish government, provides information on numbers of registered enterprises (businesses) operating in Scotland, broken down by industry, business size, local authority area, urban/rural area, and country of ownership.
Business Structure, published annually by the Welsh Government, contains data on the estimated number of registered businesses active in Wales.
Northern Ireland business; activity, size and location, published annually by the Northern Ireland Statistics and Research Agency, provides an overview of Northern Ireland’s registered business population.
Business Insights and Impact on the UK economy, published fortnightly by the ONS, provides information on the impact of the coronavirus (COVID-19) pandemic and other events on UK businesses and the economy.
Further information on other sources of business and employment data are available in Annex E of Methodology and Quality Note
The BEIS statistical revisions policy sets out the revisions policy for these statistics, which has been developed in accordance with the UK Statistics Authority Code of Practice for Statistics.
This publication is used extensively by government, the public, public bodies, and businesses to analyze the scale, structure and significance of the total business population in the UK and to monitor change over time. For example, they are used by:
Users are encouraged to provide comments and feedback on how these statistics are used and how well they meet user needs. Comments on any issues relating to this statistical release are welcomed and should be sent to: business.statistics@beis.gov.uk.
The Business Population and Demographics Statistics (BPDS) user group provides a forum for discussion of statistics and statistical research on the business population and demographics and is open to users based in central and local government, academia and the private sector.
The Office for Statistics Regulation (OSR) reviewed the ONSBusiness Demography statistics and reported their findings in October 2020. In consequence, a steering group of key business demography users was set up the remit of which covers the IDBR, which constitutes an important input into the BPE. The group meets quarterly.
The BEIS statement on statistical public engagement and data standards sets out the department’s commitments on public engagement and data standards as outlined by the Code of Practice for Statistics.
National Statistics status means that our statistics meet the highest standards of trustworthiness, quality, and public value, and it is our responsibility to maintain compliance with these standards.
The designation of these statistics as National Statistics was confirmed in August 2022 following a compliance check. These had previously been assessed in 2012.
Since the 2012 review, we have made the following improvements:
The Office for Statistics Regulation (OSR) compliance check in August 2022 identified three areas that would enhance the trustworthiness, quality and value of Business Population Estimates (BPE):
In accordance with these recommended enhancements:
Some ministers and officials receive access to these statistics up to 24 hours before release. Details of the arrangements for doing this and a list of the ministers and officials that receive pre-release access to these statistics can be found in the BEIS statement of compliance with the Pre-Release Access to Official Statistics Order 2008.
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