Furlough Money Is Boosting Business Creation But Is That Really A Good Thing?

Studio Graphene Founder, Ritam Ghandi

Studio Graphene

According to Companies House – the organisation tasked with registering businesses in the U.K. – the period from April to September saw 397,135 new incorporations, a rise of 57,000 from the same period a year earlier.   

This is counter-intuitive. The British economy has been hit hard by the pandemic and with a second lockdown underway at the moment, we are likely to see more redundancies and business closures in the months ahead. It seems like a crazy time to launch a new venture.  

But then again perhaps not. What we’re seeing at the moment is the kind of perfect employment storm that always occurs when recessions begin to bite. On the supply side of the equation, thousands of people are losing their jobs and coming onto the employment market. This month the U.K. jobless rate rose to 4.8 per cent.  On the demand side, there are relatively few vacancies. 

Office for National Statistics.  

Why Now?

Which brings me to a new survey from Studio Graphene, an app development and product design company. Carried out by market researcher, Opinium, the research is based on an online questionnaire sent to 1,200 people across the U.K.  The headline figure is that eight per cent of respondents have started a business and a further 10 per cent are thinking of doing so. The question is why?  

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Keep reading this article on Forbes Small Business.

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