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Nearly 2,400 new manufacturing firms started last year

There was a significant net increase in the number of manufacturers in the UK between 2020 and 2021 as more people chose to start their own business during the pandemic.


According to data compiled by Make UK, there are now around 140,000 manufacturing businesses across the UK, over 99 per cent of which are SMEs and micro-sized businesses. The vast majority (more than 110,000) are micro businesses with fewer than ten employees.

Between 2020 and 2021, the number of large manufacturers (those with 250+ employees) decreased by 55 as businesses either failed to survive during the pandemic or made a sufficient number of redundancies to be re-classified as an SME.

The overall number of SMEs (those with 10-249 employees) also declined by 125. Most of these losses were concentrated in industries that have suffered most from COVID-19, such as the printing, fabricated metals and furniture sub-sectors. Losses in these sub-sectors were tempered slightly by increases in markets that have seen a rapid increase in demand, including food and drink, chemicals and electronics.

The net loss of large businesses and SMEs, however, was far outweighed by an explosion of 2,570 new micro manufacturers. This means there were a total of 2,390 new manufacturing businesses operating in the UK in 2020-21 - the largest one-year increase since 2015.

A growth spurt in new businesses often occurs in the aftermath of an economic downturn, as redundancies and insolvencies lead to more people choosing to start their own business.

According to Make UK, around half of SME manufacturers aspire to become a large business within the next 5-10 years, with only 12 per cent of SMEs feeling that their business is already at the right size.

The five biggest barriers to growth identified by these firms are skills shortages (43 per cent), access to overseas markets (27 per cent), access to domestic markets (23 per cent), physical space (18 per cent) and finance (17 per cent).

Despite this, around 60 per cent of manufacturers are unaware of business support schemes available to them to help them grow. GC Business Growth Hub’s Manufacturing Service is on hand in Greater Manchester to provide SMEs with fully-funded one-to-one support on all of the above issues and more.

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