- Number of companies registered in the UK climbed to more than 850,000
- However, tough economic conditions meant firms dissolving also spiked
There are more entrepreneurs in the UK than ever according to Companies House, which saw registrations reach another record high in 2023.
Data recently published by the Office for National Statistics shows the number of companies registered in the UK climbed to more than 850,000.
A total of 859,007 companies were registered last year, an increase of just under 75,000 on the previous year (784,762), which was in turn 30,000 higher than in 2021.
Start-up nation: Company registrations on Companies House are up year-on-year
In 2013 the UK hit the milestone of 500,000 registrations in a single year for the first time. It has now exceeded 800,000, an increase of 60 per cent.
This increase in entrepreneurial ambition was further confirmed by a report by Enterprise Nation earlier this month, which found 35 per cent of UK adults were considering starting a business in 2024.
The research found those starting their own business to supplement their full and part-time income had jumped from 33 to 40 per cent.
Emma Jones CBE, founder and CEO of Enterprise Nation, said: ‘Despite 2023 being a choppy year for the economy, with many businesses struggling with inflation, rocketing energy bills, skills and labour shortages, the nation has not been deterred from starting a business.
‘We are moving towards a point where most of us will have our own money-making enterprise, a side hustle or a period of self-employment in what will be a long and so-called “squiggly” career.’
However, the significant economic headwinds have pushed some small businesses to the brink.
ONS figures show there were 307,177 voluntary dissolutions in 2023, up marginally from the 304,875 recorded in 2023.
This figure was even higher for compulsory dissolutions at 580,904, another increase on 2022 which saw 571,646 companies dissolved.
These figures could soar again this year, as experts reveal how difficult the trading environment has become.
Over 47,000 UK firms were in ‘critical’ financial distress during the final quarter of 2023, compared to 37,772 during the previous three months, according to insolvency firm Begbies Traynor.
Every industry covered by the restructuring specialist’s Red Flag Alert report saw an upsurge in firms experiencing critical financial distress in the last quarter, with 18 of the 22 sectors witnessing double-digit growth.
The restructuring specialist also revealed that the volume of companies in ‘significant’ financial distress has
Begbies also revealed that the volume of companies in ‘significant’ financial distress has climbed to 539,900, a 13 per cent gain on the previous quarter.