Micro-businesses make up vast majority of enterprises in South Tyneside

Office of National Statistics (ONS) data shows that in March 2018, there were 2,975 active local micro-businesses – defined as employers of fewer than 10 people.

The compact companies made up 89% of all the VAT or PAYE-registered enterprises in the area – the same as the UK-wide average.

Across England, there were more than two million micro-businesses active in March 2018.

Out of the 2,975 local micro-businesses in South Tyneside, 85% had fewer than five employees.

The figures include VAT or PAYE-registered businesses based in the area, so they represent local independent businesses and head offices rather than branches of UK-wide chains.

Businesses with a turnover of above £85,000 must register for VAT, although a small number may choose to register voluntarily, and all employers must register for PAYE.

Self-employed people, who make up an estimated 76% of all private sector businesses, are not counted in the figures.

Jordan Marshall, policy development manager at the Association of Independent Professionals and the Self Employed, said: “People in local communities really value micro-businesses, like independent, family-run shops.”

But he said that the resources available for micro-businesses varies a lot depending on where they are located.

He said council-funded initiatives like co-working and networking spaces can help micro-business owners reduce costs.

He said: “The extent to which the council supports these spaces will have quite a big effect on independent businesses.”

Mr Marshall also said that advances in technology have made it easier for people to run micro-businesses from home.

He said: “Remote working means you can operate a business from anywhere.

“You’re not dependent on large employers, and you can have clients anywhere in the world.”

The Federation of Small Businesses said that “more encouragement is needed to make sure more people can start and grow a business”.

Chairman Mike Cherry said: “Despite rising costs and flagging consumer demand, we still have an increasing number of people taking the brave, exciting step of starting a small business.”

The Department for Business, Energy and Industrial Strategy said that since 2012 their Start-Up Loans programme has provided more than 57,000 loans, totalling over £436million.

A BEIS spokesperson said: “Through our modern Industrial Strategy we are determined to make the UK the best place to start and grow a business of any size.

“We are taking steps to help small and micro-businesses thrive, with the Government-owned British Business Bank currently supporting more than £5.2billion of finance to almost 75,000 smaller businesses in the UK.”