Dragon’s Den fails to persuade
Over the weekend I read a report that indicates there’s been a sharp fall in the number of people setting up their own businesses. Setting up a business is incredibly exciting, but it’s challenging at the best of times. Traditionally the received wisdom is that 50% of new businesses fail in the first 12 months, though more recently figures have suggested that the real figure is closer to a 9% failure rate.
The annual survey of 30,000 UK residents, called the Global Entrepreneurship Monitor, reports that for the first time since the survey began in 2003, fewer than half the adults surveyed thought that starting a business was a ‘good career option’. Only 3.8% of the population expects to start a business in the next three years, compared with 5.9% in 2004. It seems that Duncan Bannatyne, Peter Jones and the other dragons are not currently inspiring people to take the plunge.
The coalition government has said that it sees the private sector as the main area for growth, helping to lead the economy out of recession. Minister for Small Business Mark Prisk has said, “The Government ……… will meet that challenge by making this decade the most entrepreneurial and dynamic in our history.”
Mr Prisk has promised that the Government would develop a coherent and comprehensive strategy for enterprise. This would include, challenging aspirations and capability, modernising business support, supporting cash flow and access to finance, reducing burdens and transforming opportunities for individuals and their communities.
While I like the sound of some of these, I remain to be convinced that the key problems will be properly addressed. Business has been milked like a cash cow by government – and certainly in the short term the financial burdens are likely to get worse, not better. It’s not only the employment law side of things. Employment rights have been significantly increased in recent years. While it’s right that employees are well cared for and not exploited, the cost has been forced upon employers with little regard to commercial feasibility. Currently the cost of NICs to employers is staggering and many employers are seeking to reduce that burden by outsourcing. From 2010 employers will have to introduce and pay for pensions (this will be a huge cost to a fragile economy) and the bureaucracy employers have to navigate is quite appalling. Some of my clients – decent, caring people, who have wanted to be good employers – have had to make a decision to go back to being one-man bands. Being an employer is a luxury that many simply can’t afford.
Keep the costs of your business under control by attending our practical employment law training. Our next course, Managing Poor Work Performance is scheduled for 3rd November. For more information, visit our website at http://www.russellhrconsulting.co.uk/ or call a member of the team on 0845 644 8955.
Russell HR Consulting offers HR services to businesses nationwide, including Buckinghamshire (covering Aylesbury, High Wycombe, Milton Keynes, Bedford, Banbury, Northampton, Towcester and surrounding areas), Nottinghamshire (covering Chesterfield, Mansfield, Nottingham, Sheffield, Worksop and surrounding areas) and Hampshire (covering Aldershot, Basingstoke, Reading, Farnborough, Fareham, Portsmouth, Southampton and surrounding areas).