The UK is home to some of the world’s most creative companies, from fashion designers and handbag makers to TV companies, animators and advertising agencies – and their output accounts for some of the nation’s biggest exports.
The sector contributes six per cent to UK GDP, employs more than two million people and exports £16 billion worth of goods and services a year. And it’s set for further growth in the coming years, with global demand for the best of British talent continually rising.
Sector at a glance
Creative industries generate £70,000 every minute for the UK economy
- 1.5 million British employees work in the industry
- The sector accounts for £1 in every £10 of the UK’s exports
Creative industries and the economy
The companies that made the 1,000 list have enjoyed strong revenue growth during the past four years, with 2010 a particularly good period. Indeed, the average revenue soared by 54.6 per cent, before slowing to 43.9 per cent in 2011. A further slowdown came in 2012, when revenues grew by 29.6 per cent – an increase that most sectors would be more than happy with.
The Confederation of Business Industries believes creative industries are essential to the UK’s growth and prosperity – providing they receive the right level of support. "We have the largest creative sector in Europe, one of the world’s largest music industries and one of its most advanced digital TV and radio markets," the body said.
"The sector is forecast to play a bigger role in coming years. If the UK is to achieve a balanced, high-growth economy, it is vital that the key strengths of businesses in the creative sector are nurtured and championed by Government."
Fuelling the engines of growth
Commentary by Tim Ward, CEO, the Quoted Companies Alliance
SMEs are the engines of growth – it is as simple as that. They are the future of the UK economy. The largest global companies that are listed in the UK are not typically fast growing, nor are they habitual creators of new jobs. As small companies grow, they employ, they innovate and they create change.
These engines of growth need an environment where they can access finance. Traditionally, SMEs turn solely to the banks to finance their growth. However, the benefit of permanent equity capital should not be underestimated. Bank debt provides useful finance for working capital and projects, while equity capital is necessary for long-term sustainable growth.
Equity investment is an essential fuel for the engines of growth; it can be public or private, institutional or personal investment. What it provides is a non-returnable commitment from an investor. It is a clear signal that an investor is placing their trust in the company and, in return, expects good corporate governance behaviour and strong financial performance.
"Two-thirds of small and mid-cap quoted companies are optimistic about the prospects for the UK economy over the next 12 months"
SMEs deserve a high degree of support from asset owners, policymakers, regulators and market operators as well as government. The Quoted Companies Alliance (QCA) campaigns long and hard to ensure the engines of growth can access public equity markets. We work to ensure there are good fiscal incentives for investors to invest in small and mid-size quoted companies.
The Alliance also presses to ensure rules and laws designed to regulate the juggernauts of the public markets are not imposed on the smaller vehicles that will bring about the economic recovery we are starting to witness. Allowing AIM shares to be included in ISAs and the abolition of Stamp Duty on trading in AIM shares are two examples of where we have created more fuel for the real engines of growth.
The UK economy is at a turning point. Our QCA/BDO Small and Mid-Cap Sentiment Index shows that confidence in the UK economy is at its highest level since the survey began two years ago. Two-thirds of small and mid-cap quoted companies are optimistic about the prospects for the UK economy over the next 12 months, compared with eight per cent of companies a year ago. We need to ensure the engines of growth can access all the fuel they need so that we can continue to build on this optimism and create more jobs, more innovation and more economic prosperity.