Three million family businesses keep the economy ticking over

THE UK is home to 3m family businesses, which provide 9.4m jobs, generate a quarter of GDP and pay £102bn in tax each year, new research for The Institute for Family Business has revealed.
By The Newsroom
Published 17th Dec 2014, 00:00 BST
Director General of The Institute for Family Business, Mark Hastings.Director General of The Institute for Family Business, Mark Hastings.
Director General of The Institute for Family Business, Mark Hastings.

Oxford Economics detailed the enormous contribution that family-owned firms make to national prosperity.

It calculates that an extra 30,000 family businesses have been created since 2010; while the majority are small businesses, more than 15,000 are medium and large companies.

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More than one in ten large companies are family owned, and nearly half of all medium-sized businesses, said the consultancy.

It also found that employment by family businesses is up by half a million since 2010.

Oxford Economics said the Gross Value Added (GVA) of family firms has increased by £3bn since 2010 to £360bn – a quarter of UK GDP.

It found that family firms turnover an estimated £1.1 trillion annually, some 32 per cent of total private sector turnover.

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More than 15 per cent of government revenues – £102bn –were generated by the family business sector, said the consultancy. The IFB is calling on the Government to boost growth in the sector by introducing alternatives to bank lending for business financing.

The IFB believes the UK needs greater competition and choice in business financing. It recommends the introduction of a private placement market, a bond market for SMEs and liberalising lending from the insurance market.

Related topics:GDPGovernmentSMEs