SMEs driving private sector employment growth, according to survey

SMEs have helped to boost employment in the UK, driving more than 70 per cent of employment growth in the private sector since 2011, research from npower Business and Capital Economics has shown.

The research showed that SMEs employ 5.7 million people nationally, which amounts to nearly 50 per cent of the UK’s entire working population.


The top-performing SME sectors were revealed, with education support, temporary employment agencies and management consultancy being among the sectors that are driving growth.

SMEs are expected to continue to boost employment, with top sectors in the City of London, Birmingham, Leeds, Liverpool, Hull, Manchester and Newcastle set to create 25,000 jobs by 2021. This will help to boost the UK economy by £1.2 billion.

The research also found that small businesses are taking on university-trained workers, with businesses that have between two and 49 employees being more likely on average to have staff that have a degree than larger businesses.

The research comes after figures released by the Office for National Statistics (ONS) earlier this week showed that employment in the UK has reached a record high, with 31.95 million people in work.


Commenting on the research, npower Business Head Richard Longbottom said: “The UK’s entrepreneurial spirit is clearly flourishing. There are now almost 5.6 million SMEs in the country.”

He added: “These innovative, industrious businesses have created jobs for 1.8 million people in the past five years alone. We’re dedicated to helping SMEs thrive and are delighted to see this trend.”

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