52 businesses were created every day in Birmingham in the first half of 2022, according to new research by iwoca – one of Europe’s largest small business lenders.
Analysis of Companies House data reveals that 9,333 businesses were registered in Birmingham between January and June 2022, an increase of 25% from 2021, and an increase of 79% from the same period in 2019.
Birmingham second most popular place to start a business in the West Midlands
iwoca’s Small Business HotSpots UK 2022 shows that Birmingham had the second highest rate of new business creation per capita out of all local authorities in the West Midlands with 815 businesses created per 100,000 people in the first half of this year. Herefordshire saw the highest business growth in the West Midlands, with 900 per 100,000, with Wolverhampton in third (743) and Coventry in fourth (738) in the region.
The West Midlands experienced the second highest rate of new business creation per capita out of all UK regions, with 571 per 100,000, up 12% from 2021.
UK sees surge in small business growth
Across the UK, 93 new businesses were created every hour in the first half of 2022 with over 402,000 businesses registered in the UK between January and June 2022, an increase of 18% from 340,500 over the same time period in 2021.
London saw the highest rate of business creation in the first half of this year with 1,587 businesses being created per 100,000 people. This was followed by the West Midlands (571) and North West (554). Scotland appeared bottom of the list with a rate of 338 new businesses per head, with the North East in second last place with 345.
Increase in new small businesses follows record high of job moves
The rise in new businesses sits alongside an increase in the number of workers seen moving jobs this year. Total job to job moves within the UK increased to a record high of 997,000 during the first quarter. The ONS states that this rise has been driven by resignations – suggesting that some workers are deciding to quit their jobs and set up new businesses.
Seema Desai, iwoca’s Chief Operating Officer said: “Despite the prevailing headwinds of an impending recession, we are encouraged to see that so many businesses have been created during the first half of this year.
“As many of these businesses struggle with cash flow in the coming months due to skyrocketing business costs, it is vital that lenders step in to provide a helping hand. We are proud to do our part at iwoca adapting to the needs of small businesses. We do this mainly by deploying the latest embedded technology so that SMEs across the country can access our finance through the services they already use day-to -day.”
Cassie Ryan, owner of Birmingham based NOIR Footwear, said: “I have always dreamed of setting up my own footwear brand, and during the pandemic I decided to bite the bullet and actually do it. As a single parent on furlough, I enjoyed the extra time I was able to spend with my daughter, and realised that I wanted the flexibility not only to chase my dreams, but to also achieve a better work life balance.
“It’s been an incredible 12 months. I have enjoyed some successes whilst also learning from the challenges and mistakes along the way.
“There is no doubt that this is an exciting journey and I hope to continue to grow over the next few years. iwoca has played a vital part in providing us with the finance required to do just that.”
iwoca was accredited to the Recovery Loan Scheme, having distributed nearly £400 million to small businesses through the Government’s Coronavirus Business Interruption Loan Scheme (CBILS). In June 2020 the lender launched iwocaPay – an online buy now pay later invoice checkout to help small businesses get paid. iwoca is reaching 1.8 million businesses across the UK and Germany through its embedded lending technology, which allows businesses to access loans through a range of platforms such as accountancy software apps and digital neo-banks. The company has also recently launched free mental health support for all small businesses in the UK, in partnership with online therapy platform Spill.