Going to London to seek one’s fortune is a well-trodden path – both for graduates braving high rents in the hunt for big salaries and for entrepreneurs looking to set up shop. But new figures suggest that the regions are outpacing the capital when it comes to business growth.
The analysis by the Enterprise Research Centre focused on ‘high-growth firms’ (‘HGFs’) – defined by the OECD as having more than 10 employees and having expanded their workforce by more than 20% annually for at least three years. Though London is home to a disproportionately large share of these (2,430, or 9.5% of all firms with more than 10 staff), the rest of the country is catching up quick.
Between the periods 2009-12 and 2012-15, the number of HGFs in London grew by just 15%, while across the rest of England they were up 36% to 7,855. In Scotland they were up 35% and in Wales 38%. It seems London is not the place to be if you’re growing a business right now. So where is?
The ‘Solent’ area, covering Southampton and Portsmouth, enjoyed the biggest rise, up 64% to 304. The number of HGFs jumped by 62% to 256 across Norfolk and Suffolk, and by the same proportion to 250 in Bristol and Bath.
It’s obviously good news for regional development but we shouldn’t get carried away. London is still home to a far greater number of fast-growing companies than any other region, and the south-east is second on 582. Long-suffering areas like Cumbria, the Tees Valley and Cornwall may be expanding at a faster rate than the capital but their number of high-growth firms still number in just the tens, rather than the thousands. The regions have a lot of ground to make up.