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Regional variations in new firm job creation: The contribution of high growth start-ups

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  • Ron Botham
  • Andrew Graves

Abstract

Much existing work argues that a small number of high growth start-ups create the majority of new firm jobs; that policies aiming to increase the volume (i.e. number) of start-ups in the UK’s less entrepreneurial regions may adversely affect their growth or quality; and, therefore, policy should target high growth new starts. To test these arguments, a database of all UK independent limited companies set up between 2001 and 2005 still operating in 2008 was constructed and analysed. In 2008 there were 351,000 such start-ups with 1.51 m employees. Defining high growth as firms with over 24 employees in 2008, high growth start-ups did not create the majority of new firm jobs and the ‘job creation problem’ in the UK’s less entrepreneurial regions is too few start-ups rather than a relative absence of high growth start-ups. Consequently, in the UK’s less entrepreneurial regions policy should aim to increase the volume of start-ups.

Suggested Citation

  • Ron Botham & Andrew Graves, 2011. "Regional variations in new firm job creation: The contribution of high growth start-ups," Local Economy, London South Bank University, vol. 26(2), pages 95-107, March.
    • Handle: RePEc:sae:loceco:v:26:y:2011:i:2:p:95-107
    DOI: 10.1177/0269094210397849
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    References listed on IDEAS

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    Cited by:

    1. Alex Coad & Julian S. Frankish & Richard G. Roberts & David J. Storey, 2016. "Predicting new venture survival and growth: Does the fog lift?," Small Business Economics, Springer, vol. 47(1), pages 217-241, June.

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