The latest figures show that more new businesses were established in the West Midlands during 2020 than in any previous year – hitting a new record high.
Despite the considerable economic challenges posed by the Coronavirus pandemic, 37,202 new companies were registered in the region compared to 29,676 during 2019, representing an increase of 25.4%.
This brings the total number of registered companies in the West Midlands to 191,692, up from 173,134 at the end of 2019, which equates to 10.7% growth.
The statistics are taken from the Inform Direct Review of Company Formations using data from Companies House and the Office for National Statistics.
Birmingham formed the highest number of new businesses (18,435), followed by Sandwell (4,765) and Coventry (4,169).
John Korchak, Operations Director at Inform Direct said: “It is excellent news to see that the West Midlands has achieved a record year for new company formations during 2020 despite the unprecedented uncertainties brought by COVID-19.
“Many of the new company formations are in the retail sector, with a large number of new businesses set up to sell goods online or locally, thereby taking advantage of customers’ changing shopping habits. Secondly, the effect of the pandemic and national lockdowns means that sadly some existing businesses have folded and employees made redundant, and we see many of those people setting up new ventures on their own as an alternative way to earn a living.
“2020 was a year like no other for UK businesses. Although we can look forward to a brighter future with the vaccination programme, there remain unknown factors such as how quickly the economy will recover and of course the impact of Brexit.”
Alongside the West Midlands’ achievement, the UK as a whole saw a record-breaking 780,766 new businesses formed, compared to 690,763 in 2019. The overall number of UK companies also continued to grow to 4,837,426, an 8.2% increase in the total of 4,471,008 at the end of 2019.
The number of company dissolutions across the UK – 418,427 during 2020 – was the lowest since 2015. It remains open to debate whether this positive trend will last, especially when Government support for businesses is withdrawn. New enterprises set up during the pandemic might also be short-lived, as people return to full-time employment or struggle to take the business to the next level.