Number of businesses operating in the UK hits record high
The UK set a new record of 5.63 million active companies registered with Companies House at the end of 2024, an increase of 3% on the year before, according to the NatWest and Beauhurst New Startup Index, which has been published today.
Almost 850,000 businesses joined the UK’s corporate register last year. The first quarter of the year saw the highest number of company formations of any quarter in the past five years, peaking at 248,000, but despite a robust start, this had fallen to 184,000 incorporations during Q4 in the historically quietest quarter of the year.
Last year property businesses recorded the largest percentage increase in new business formations, growing by 38% year-on-year to 44,000 new businesses. 22,000 new takeaway shops and food stands were also set up, a 14% increase compared to 2023, as well as nearly 38,000 management consultancy businesses, a 10.7% increase.
Due to the overall decline in business formations in 2024, across the UK, most regions saw minor declines in year-on-year incorporations. London continued to lead in business formations with 286,000 new incorporations, though this number was slightly lower than 2023.
While companies with all-male directorship teams continued to represent the majority of new firms, there was a noticeable shift towards more gender balanced boards. Companies with mixed-gender directorship teams saw a slight increase, growing from 10.4% of all incorporations in 2023, to 11.3% in 2024.
James Holian, head of business banking at NatWest, said: “It’s a testament to the UK’s reputation as a nation of entrepreneurs that the number of active companies operating in the UK stands at a record high. But with the number of company incorporations falling slightly as 2024 progressed, there is still more to be done to give prospective entrepreneurs the confidence and tools to start a new business.
“At NatWest we are committed to nurturing these shoots of new business growth to attract jobs and investment to the UK. Our Accelerator programme plays a key role in giving start-ups the tools to scale and succeed – with data showing our support significantly boosts businesses’ turnover, investment and chances of survival.
“As we move into 2025, with the number of incorporations projected to fall from the exceptionally high numbers of the past few years, it’s vital that the public and private sectors work together to give young start-ups the support, guidance and tools they need to survive and grow, no matter what environment they might face.”
Gareth Thomas, minister for Small Business, said: “Seeing a record number of active businesses shows the ambition of our country’s entrepreneurs and that the UK is a fantastic place to start and grow a company.
“Our Plan for Change will continue to back businesses to grow the economy and help business owners turn their ideas into long-term success.”
Henry Whorwood, managing director at Beauhurst, said: “Companies House data shows there are now 5.6 million active companies operating in the UK – a new record. Whilst there was a slight decline in company incorporations last year, UK entrepreneurs are still starting lots of new businesses. In 2024 Companies House began phasing in greater checks to ensure the legitimacy of companies so it’s reasonable to suspect that alongside this growth in the base population that the share of fraudulent activity has gone down.”