Wales

Wales sees 26% drop in new businesses over five years

  • 11 January 2017
  • From the section Wales
  • comments
Media captionKaren and her husband Mark Owen sold their home to help start up the Wickedly Welsh chocolate firm in Haverfordwest

The number of new businesses starting up in Wales has dropped by 26% over five years, figures obtained by a banking group have shown.

UK-wide there was a 19% fall, with a 20% drop in England and 3% in Scotland.

Data from BankSearch for Lloyds Bank showed almost half of Scotland's regions recorded growth.

The bank said the downward trend was likely to be in response to the "uncertain economic environment".

Across Wales, 23,195 new business start-ups were recorded in the 12 months to November 2011, compared to 17,089 in the year to November 2016.

Anglesey saw the biggest fall, from 668 start-ups to 337 in the same period, but Merthyr Tydfil only fell from 364 to 363.

Economists say this could be a sign that things are going well with those forced to become self-employed after the financial crisis now finding more secure work.

Prof Dylan Jones-Evans, of the University of Western England said: "Lloyds Bank have said shows the economy was uncertain because of this drop.

"Well, actually it works the other way because many people go into self-employment not because they've seen an opportunity but because of necessity and once the economic problems get better then what happens is they go away from self-employment back into employment."

"So paradoxically perhaps what this data is actually showing is that the economy is improving".

The Federation of Small Businesses said it was essential that those starting out were prepared.

"There are a few common challenges," said Ben Cottam, of FSB Cymru.

"The first is that businesses expand - too big, too quickly. We also find that people fail to look for the right advice to support them so it might be not sourcing an accountant to get the right financial advice, which is absolutely crucial."

More on this story