Small companies are the lifeblood of any economy, and a healthy small business sector is essential if any country wants to strengthen growth and provide jobs for the population. A new report released by the Federation for Small Businesses has revealed that firms with under 250 employees are critical to provide jobs and employment for the population of the UK – especially when it comes to reducing unemployment figures.
Firms with fewer than 250 employees take on around 1.3 million unemployed and disadvantaged people each year in the UK. Companies with more than 250 employees hire less than 130,000 unemployed people each year on average. This shows what an impact the small business sector can have on unemployment figures – though individual businesses may be smaller, there’s a lot of potential for new job creation.
Population demographics such as the long-term sick, disabled and students, amongst others, are more likely to be employed in small businesses than larger ones. Similarly, 88% of unemployed people actively looking for work will find a job in a small business or a start up venture. Small companies have a greater tendency to take on those who might otherwise struggle to find a job – the 1.3million people employed per year also shows a great resilience to recession conditions.
This all goes to show what an important role small businesses play in the job market as well as in the economy as a whole. Recovery will be driven by small businesses as they strive to grow and expand, though this will only be possible with more support from policy makers. Growth is only possible with adequate finance – though there are government schemes in progress to help boost access to funds, it’s important to make sure your company has all the financing it needs to carry on fulfilling its crucial role in the job market.