A new report has revealed the key contribution that family businesses make to the UK economy.
Research by Oxford Economics for the Institute for Family Business (IFB), published on 17 December, reveals that:
- the UK has three million family businesses, providing 9.4 million jobs – 39 per cent of UK private sector employment – generating a quarter of GDP and paying £102 billion in tax each year;
- family firms turnover an estimated £1.1 trillion annually, 32 per cent of total private sector turnover.;
- an extra 30,000 family businesses have been created since 2010
- more than one in ten large companies and nearly half of all medium-sized businesses are family-owned; and
- family-run businesses make up over three-fifths of all private sector firms.
Welcoming the new research, IFB director general Mark Hastings said: “Family business is the backbone of our economy. This new research reveals just how vital family businesses are for the UK economy.
“I hope to see policy makers more openly recognising the strategic importance of the family business sector in rebalancing our economy.”
The IFB is urging the government to boost growth in the family business sector by introducing more alternatives to bank lending for business finance. It is also wants the Enterprise Investment Scheme rules to allow family businesses to invest in new family start-ups, which is currently prohibited, which it says would foster entrepreneurship and boost innovation in the sector.
At Palmers, we are experienced in working with family businesses and can provide tailored advice to help them plan for growth, to strengthen internal governance and for smooth transitions of ownership between generations.
Our expertise includes succession planning, shareholder and partnership agreements and family dispute resolution. For more information, please visit our website or contact BJ Chong.