York jumps up new business rankings

THE City of York has leapt up the league table of the top 50 UK towns and cities creating new businesses. 

Research by York-based accountancy firm UHY Calvert Smith showed that the historic city jumped from 32nd to 16th place.

A net total of 10 new businesses were set up per 10,000 residents compared with just six in the previous year.

The rankings were compiled by measuring the number of VAT registration against the number of deregistrations in 2007 – the most recent set of Goverment figures available.

Leeds was also highly placed reaching 12th with an average 11 businesses per 10,000 residents.

Bradford was 16th with a net of 10 firms while Hull fell in 32nd place with a net average of six.

Sheffield, which has long held a reputation for being one of the region’s most entrepreneurial cities was ranked 46th with a poor three businesses per 10,000.

Aberdeen topped the rankings with 34 businesses per 10,000. The UK average according to the findings is 12.

Southend-on-sea has clung to its rank of 50th place for the second year running losing two more businesses than it generated.

Nevil Pearce, partner at UHY Calvert Smith, said that York’s efforts to move into growth sectors of the economy such as IT and biotechnology seemed to be paying off by helping to replace jobs lost in its traditional confectionary and manufacturing base.

“However, these figures only cover the early stages of the credit crunch so we can’t relax yet,” he warned.

“York’s business community, York Council and other groups helping start-ups will have to work harder than ever to maintain this success.”

Mr Pearce said that it was York’s ability to replace closing businesses with new start-ups that will determine whether its local economy can continue to weather the economic conditions better than rival cities.

Currently the city is showing some signs of stress with factories, such as printing company Polestar Greaves, closing their doors as manufacturing moves overseas.

And it’s not just manufacturing that is giving cause for concern. There are fears that York’s financial services sector may also suffer further job losses.

“Up until now York has enjoyed a successful rate of new business generation, but the credit crunch will slow it down,” continued Mr Pearce.

“Since the bubble burst, losses in the financial services sector, and the property sectors mean that business growth in these sectors and in related support services will take a knock. Small start-ups will also struggle to secure funding because lending standards have tightened up dramatically.”

Nevil Pearce says: “York has maintained its competitive edge by moving into high-tech sectors such as biotechnology.

“The University’s Enterprise and Innovation Office and The White Rose Centre for Enterprise have worked hard at generating local entrepreneurs, while the Science City has played a key role in driving the creation and growth of more than 80 businesses in bioscience and technology industries in the past 10 years.”

Even though other sectors may suffer as a result of the economic downturn, York’s reputation as a tourist destination looks set to continue.

“Whether York can reap a huge dividend from the weak pound and increase its foreign tourism remains to be seen. York is more likely to see an increase in demand from British tourists choosing to take trips to York,” said Mr Pearce.