New evidence on the economic impact of family firms
Family business contribution to the UK economy in 2023
Family businesses remain the cornerstone of the UK economy, contributing £985 billion in Gross Value Added (GVA) in 2023 and employing 15.8 million people, according to a new report, “The State of the Nation: the UK Family Business Sector in 2023”. The report, compiled by the Centre for Economics and Business Research (Cebr), provides a comprehensive and up-to-date analysis of the sector in the UK.
The findings underscore the importance of family firms, which represent 93.2 per cent of all UK private sector businesses and span industries including construction, retail, professional services, and agriculture. These businesses, often celebrated for their resilience and long-term focus, are revealed to be pivotal in driving regional and national economic growth.
Summary of Key Findings:
Economic powerhouses: Family businesses generated an estimated £985 billion in Gross Value Added (GVA) in 2023, accounting for nearly 50 per cent of the private sector’s GVA.
Employment leaders: Employing 15.8 million people, family firms represent 57% of private sector employment, with a notable presence in construction, wholesale, retail, and professional services.
Fiscal contributions: Contributing £422 billion in taxes, family firms underscore their importance in sustaining public services and infrastructure.
Adaptability and resilience: Despite challenges in recent years such as the post-pandemic recovery, technological change, and Brexit, family firms continue to demonstrate resilience and adaptability, making significant contributions across all regions and industries in the UK.
The report’s findings will be of interest to government bodies, industry associations, family business leaders, owners of family firms and their advisers, and researchers working in the field. It provides essential material and background for current policy debates in the UK about the importance of family businesses to the UK economy and the impact of policies relating to growth and taxation.