THE number of private businesses in the North East is the lowest in England, and that number has fallen in the last 12 months, new governments data has revealed.

However, the Business Population Estimates released by the Department of Business, Energy and Industrial Strategy (BEIS) showed that more of the businesses that remain are growing.

At the start of 2019, there were 5.2 million private sector businesses in England, but the North East had just 152,000 private sector businesses, the least of any English region, although our region has the lowest business density rate of any English region or UK country.

There was a fall in the number of private sector businesses in the region from 163,000 at the start of 2018 to 151,500 at the turn of 2019.

However, North East businesses still recorded a turnover of £78.9bn at the start of the year, and statistics released by HMRC revealed the number of VAT and PAYE-registered enterprises increased by 1,070 to 70,460 over the year – the largest growth since 2016/17.

This suggests that while more sole trader businesses are closing, the number of businesses taking on employees and being required to register for VAT – by earning in excess of £85,000 per year – are rising.

The BEIS statistics also reveal the North East has the lowest business density rate of 694 businesses per 10,000 population, down from 749 in 2018, of any region or UK country.

The importance of small businesses to the region was also highlighted, with 99.2 per cent of people working in a business with less than 49 employees, the majority (75.4 per cent) working as a sole trader.

Chief executive of the Entrepreneurs’ Forum Jonathan Lamb said: “While it is disappointing that the North East has the fewest number of businesses of any English region and that figure has fallen over the past 12 months, the region is evolving in terms of business and there remain many positives for the future.

“Not least, that there is an increase in the number of businesses providing employment and exceeding a turnover figure of £85,000.

“Entrepreneurs are all about resilience and optimism and taking on and overcoming challenges and they are the key to creating future jobs and prosperity.

“This region is famous for its past feats of invention and innovation – from railways through to acrylic safety glass – but there are many modern-day successes in the rapidly expanding digital and creative sector, the offshore and subsea sector, advanced manufacturing and life sciences."

“These latest figures do highlight the importance of small and medium-sized enterprises to our economy and therefore the continued need to encourage the start-up and scale-up of businesses.

“Entrepreneurs are by their very nature independent and self-reliant, but I would ask the Government to do whatever it can to ease the burden placed upon entrepreneurs, whether that is by creating more supportive and efficient processes or narrowing the skills gap.

“There are many examples of the private sector taking the lead in nurturing and supporting new business, including our partners, who offer everything from co-working space to structured mentoring schemes."