Why 2021 could be the year of the small business success story
The use of the Oxford-AstraZeneca, approved in late December, is thought to be a key turning point in the fight against Covid in the UK and worldwide.
Despite high numbers of cases in the latter part of December, business sentiment has been growing more and more optimistic since the news of the efficacy of the first vaccine back in November. One area of business that this applies to particularly strongly to seems to be small businesses. A recent report found that, even before the approval of the second vaccine, 77% of SMEs were looking to hire new staff in 2021 – a significant proportion coming in Q1.
A separate report highlighted the desire to start a new business in 2021, with one in five Brits hoping to start a business this year – growing to one third of those 18-34 years old. Just over half, however, said they would need support to do so. SMEs already make up 99.9% of private sector businesses and employ over 16million people, so the growth of the sector, and supporting it, is key to the UK economy in the coming years.
Britain has always been a nation of shopkeepers, and the UK’s community of small business owners and entrepreneurs will be key to our economic recovery in 2021. The desire to grow and start new ventures is something that still persisted throughout 2020 and now, with a Brexit deal in place and vaccines proving effective and being deployed, this sentiment will only grow as major barriers eventually fall away.
Turning this desire and ambition into success will require no small amount of support from the private investment community, whether that be seed funding for new businesses or growth finance through the Enterprise Investment Scheme. An extension to EIS in the March budget would undoubtedly catalyse growth and lead to more investment in businesses looking to create jobs and opportunities.
One of the firms we invested into during 2020 has since doubled its staff in what is an indication of what can be achieved with ambition and the right funding. Pre-pandemic, new jobs created by businesses in the SME sector grew at a faster rate than the overall job market. A return to this would provide a welcome boost, and with the right support, looks likely.
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