intelligent

The findings come from Venture Forward , an annual international research initiative by GoDaddy , and additional analysis from economics consultancy , Frontier Economics . In what is believed to be the first study of its kind in the United Kingdom , the results demonstrate the significant economic impact that start-ups can have on their communities .

Venture Forward maps the concentration of digital microbusinesses – typically defined as having 10 employees or fewer , with a unique domain and active website – against local population sizes to assign every constituency in Britain a Microbusiness Density figure , which measures the number of microbusinesses per 100 people in each constituency .

Driving job growth

While entrepreneurs have long been lauded as employers in their local communities , these findings reveal their contribution to job creation is more significant than previously thought .

Increasing wages

Microbusinesses also substantially increase pay in their local areas , according to Venture Forward . The analysis shows that for every one point increase in Microbusiness Density , median annual pay for full time workers increases by £ 1,400 – a 4.4 % increase over the sample ’ s median annual pay of approximately £ 31,500 . This is especially important at a time when many Brits grapple with the rising cost of living .

The study also found that the availability of super-fast broadband also plays a role in supporting income . A 1 % increase in broadband availability is associated with an increment of about £ 110 in median annual pay , demonstrating the importance of connectivity to microbusiness and wage growth .

Boosting GDP

The study has also been able to put a figure on the local GDP growth that comes as a result of a rise in job creation and boost of earnings delivered by microbusinesses .

Each additional microbusiness per 100 people delivers a £ 37,000 rise in local GDP .

Under-researched , misunderstood and often under-served

The microbusiness sector in the UK has experienced significant growth over the last two decades , growing from 3.5 million in 2000 to 5.2 million today . In contrast , businesses of other sizes have seen minimal growth or a decline during the same period . As a result , microbusinesses now contribute to 32 % ( 8.7 million employees ) of private sector employment and 19 % of total economic output (£ 808 billion ).

Despite this , data on microbusinesses is generally scarce because these businesses often have limited resources and may not prioritise data collection and reporting . Many are also exempt from certain reporting requirement . As a result , microbusinesses , especially digital ones , are often overlooked in the public debate and the crucial role that they play in the economy is rarely acknowledged by policymakers and researchers . �

For every additional microbusiness started , the study found that seven jobs are created . This includes direct factors , such as hires by the business itself , and indirect factors , such as increased demand for products and services from suppliers , which leads to further hires .