Whilst UK business start-up rates increase in 2015 compared to 2014, research from RSA suggests that more than half of start-up businesses don’t make it past their fifth birthday.


With 383,000 start-up businesses launched in 2015, it’s easy to feel good about the growth of the UK’s economy – but looking in more detail suggests that staying in business and surviving past the first few years, is the real issue that British businesses are facing.  


Business Births and Deaths in 2015

At the end of November 2016, the ONS released its latest Business Demography Research.


Almost 10% more UK Business Births, year-on-year

The number of businesses registered in the UK in 2015 increased by 9.3% on 2014 levels, meaning that the UK’s ‘Business Birth Rate’ was 14.3% of active businesses compared with a 13.7% birth rate in 2014.


The highest number of new businesses since records began

Records began in the year 2000, with 383,000 businesses being registered in 2015, making it the highest number to be registered in a year since the statistics started being produced.


Business Deaths also Increased

The number of UK businesses that closed their doors in 2015 was 252,000, an increase of 2.1% on the figure in 2014 – meaning that the UK business death rate is now 9.4%. Although this is an increase in numbers, when compared to 2014, the number of deaths as a percentage of active business, was down from 9.7% in 2014.


Business births and deaths by industry and sector

Transport and storage industries saw the largest growth on a percentage basis in 2015, with 20.3% growth, compared to just 17.5% in 2014.

Overall, the professional, scientific and technical industries had the highest amount of business births, with 81,000 businesses. Looking further into the data, the largest contributing industry to this figure was management consultancy, with 36,000 new businesses in 2015, up by 6000 in 2014.

When it comes to the industries with the highest business death rates in 2015, finance and insurance saw the biggest percentage, with 13.3%, although this was down from 14.8% in 2014.

The table below shows a breakdown of the business birth and death rates in 2015.



Top Reasons for Business Failure

Entrepreneurs polled by the RSA identified that lack of bank lending, business running costs and the tax system in the UK, as the biggest contributing factors to business failure in the UK.


The problem is multiplied by the fact that if companies don’t grow and can’t employ more staff, then the business could join the numerous zombie businesses that are kept afloat by low-interest rates, amongst other factors.


If your business is struggling, it is advisable to seek help sooner rather than later. If you are looking for help with your business, discover your business recovery options here.


All information is intended solely for informational purposes and should not be used as a substitute for specific professional advice.