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Entrepreneurs back UK as start-up location after Brexit

16 Dec 2016

Desk of office workers on digital devicesThere is still strong support for the UK as a place to start a business after the Brexit vote, with a new survey of nearly 200 entrepreneurs showing 85 per cent would still pick Britain as their home over other European cities. 6 in 10 members in the Institute of Directors’ ‘IoD99’ group for start-ups are yet to see an impact from the referendum, but over half are worried leaving the EU will hinder their growth over the next five years.

Their specific concerns relate to their ability to sell their goods and services to the EU in future, and their access to a wide pool of EU workers. While the future shape of the UK’s immigration policy is up in the air, the second highest priority for entrepreneurs is digital infrastructure, which is in the gift of the Government to act on now.

The IoD welcomed the Chancellor’s announcement at the recent Autumn Statement of a £740m investment in a 5G mobile network, but the business organisation thinks the priority should be improving the existing 4G network. It was highlighted earlier this week by the National Infrastructure Commission that UK mobile phone users still suffer from ‘digital deserts’ where internet coverage is poor. 

Simon Walker, Director General of the Institute of Directors, said:

“The UK has created a healthy environment for entrepreneurs in recent years, and this survey confirms that it is still a great place to set up a business. The desire to build a successful enterprise, and at the same time to make a positive social impact, is driving more and more people to found a company.

“Brexit will inevitably pose challenges for new businesses, particularly in being able to recruit the right people to enable them to grow rapidly. New industries are providing opportunities for British workers, but specific skills in developing areas are always scarce. Even after the UK leaves the EU, our immigration policy will have to remain open to the best and brightest from across the world. 

“We won’t know the outcome of negotiations with the EU for at least a couple of years, but there is plenty our politicians could be doing now to help start-ups weather the uncertainty to come. Access to fast broadband speeds and adequate finance are headline issues for entrepreneurs, and should be priorities for the Government.”  

Full results

197 members of the IoD99, the IoD’s group of 1,200 entrepreneurs under the age of 40 answered a survey conducted in November. Percentages may not sum to 100 due to rounding.

What was the primary reason you had for starting your own business?

To build a successful business

33%

Desire to be your own boss

24%

To make a positive social impact

21%

To create a successful product/service

20%

The financial reward

3%



                                                                                                                      


When you started your current business, were you:

In full time work at another firm

52%

In part time work at another firm

7%

A student

9%

Exclusively working on your start-up

24%

Other (please specify)

9%


Are you still in work, alongside running your business?

Yes, full time

12%

Yes, part time

11%

No

76%

Other (please specify)

2%


Over the next 12 months, how important do you consider the following factors to be for your business?


Very important

Quite Important

Neither

Unimportant

Very unimportant

Access to skilled employees

53%

28%

10%

7%

2%

Access to finance

40%

27%

13%

17%

3%

Digital Infrastructure

47%

43%

8%

2%

1%

Transport Infrastructure

15%

25%

29%

21%

10%

Business taxes

37%

43%

15%

5%

1%

Personal taxes

36%

40%

19%

5%

1%

Cost of labour

36%

34%

17%

11%

2%

Availability/cost of commercial property

17%

25%

26%

21%

11%

Availability/cost of residential property

16%

22%

23%

22%

17%

Regulatory/legal landscape

26%

39%

21%

10%

4%


Over the past four months, have you noticed any impact on your business from the outcome of the referendum?

Yes, the vote has had a positive impact

8%

Yes, the vote has had a negative impact

34%

No

57%


To what extent, if any, do you believe the vote will impact growth in your business over the next 5 years?

The vote will likely boost growth in my business

17%

The vote will likely hinder growth in my business

54%

The vote will have no effect

30%


If you had the option of starting your business again, would you still look to establish in the UK, or would you choose to set up shop in another European enterprise hub?

I would still establish my business in the UK

85%

I would look elsewhere in Europe

15%


What do you believe should be the main priority for the government in the forthcoming negotiations with the EU?

Very important

Quite important

Neither

Unimportant

Very unimportant

Securing continued membership of the single market in goods

57%

29%

12%

1%

1%

Securing continued membership of the single market in services

68%

23%

7%

1%

1%

Ensuring that – in future - UK start-ups have access to a wide pool of skills from the EU

61%

25%

10%

3%

1%

Ensuring that those from within the EU currently in the UK can remain here as residents

62%

21%

12%

4%

2%

Ensuring grant funding remains available to UK research institutions and universities

57 %

28%

9%

4%

1%

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