Booksmart: libraries and museums named most resilient sector for new business

Startups in the cultural sector are thriving more than any other industry according to a new study, which also reveals survival rates per activity and area.

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New research has revealed the most resilient UK industries to launch new businesses in – and you may be surprised to learn it’s libraries, archives, museums and other cultural activities that topped the rankings.

New businesses that launched in the culture-focused sector saw a 65.2% survival rate five years after launch. The research, which was published in The UK New Business Report by money.co.uk, indicates that businesses in this sector have a high resilience as institutions that have remained important.

It narrowly beat activities of membership organisations at 65.1%. This refers to political and religious organisations and trade unions, which often have loyal members that provide a steady source of revenue and contribute to their stability.

Real estate activities, the manufacturing of beverages and accommodation were runners up with similar rates at 54.6%, 54.5% and 54% respectively. 

When it comes to one-year survival rates for new businesses, manufacturers of basic pharmaceutical products and pharmaceutical preparations and water transport both came out on top at 100%. 

Number of new businesses

The report used data from the Office for National Statistics’ (ONS) business demography UK dataset to guide its findings.

The postal and courier activities industry witnessed a significant growth in the number of new businesses with a rise of 318%, growing from 5,310 companies in 2016 to 22,215 in 2021. 

This growth could be attributed to the surge in ecommerce activities and the increased need for courier services – most notably during the pandemic, when many turned to online to avoid in-person shopping.

The air transport industry experienced the second-highest growth rate at 200%, despite a dip in 2020 likely due to travel restrictions. Mining and quarrying saw a 56.1% increase, while food manufacturing businesses jumped to 56.1%.

The data also showed that local authorities with larger populations didn’t necessarily have a higher rate of new businesses. Birmingham, for example, has 1.1 million inhabitants and was ranked 64th – with a rate of six new companies per 1,000 people.

Success by area

Rutland in the East Midlands tops the list for areas with the highest one-year survival rate at 98.6%. It saw 350 new businesses established in 2020, of which 345 survived their first year. The report says this indicates that Rutland offers a favourable environment for startups, resulting in a very low failure rate. 

West Dunbartonshire in Scotland ranks second, with a one-year survival rate of 98%. There were 245 new businesses in 2020, and 240 survived their first year. For larger cities, Leicester stands out with a one-year survival rate of 96.7%.

Looking across five years, the highest new business survival rate was in the Forest of Dean, with 55.4% of the 325 businesses started in 2016 surviving. Ceredigion in Wales and Tewkesbury in Gloucestershire closely followed, with survival rates of 54.3% and 53.4% respectively.

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Kirstie Pickering - business journalist

Kirstie is a freelance journalist writing in the tech, startup and business spaces for publications including Sifted, TNW, UKTN, The Business Magazine and Maddyness UK. She also works closely with agencies such as CEW Communications to develop content for their startup and scaleup clients.

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