Often described as the UK’s “second city” alongside Birmingham, Manchester has now been named as the top new business destination outside London.
As the country’s economy continues to get back on track, with national output forecast to pick up pace between now and 2026, the number of new business births is a key marker of confidence in the market.
And last year was a record year for the inception of new business in the UK, according to new research from commercial law specialists Tend Legal, with The New Startup Index, published by NatWest and Beauhurst, reporting that more than 900,000 new firms were incorporated in 2023.
The study not only looked at new business “births”, but also business “deaths”, or the closure of companies over the time period, comparing various locations on how exciting they were as a start-up destination versus how well businesses could succeed there between 2017 and 2022
Two locations in London – Camden and Hackney – led the way, with Camden seeing the birth of 31,940 new businesses during the five-year period (and 22,970 business deaths), while 26,175 new businesses formed in Hackney (with 18,040 business deaths).
Manchester top outside London
Away from the capital, Manchester came out on top in Tend Legal’s list. The north-western city saw 28,045 new businesses incorporated during the time period, with 20,835 business closures over the same time five-year stint.
Manchester has numerous qualities that attract new businesses and investors, and this has become more heightened in recent years due to more companies and top talent leaving the capital city for the country’s many top-performing regional cities.
The city of Manchester and the surrounding area is one of the most popular places for London-leavers to gravitate towards, with its thriving economy, flourishing jobs market, and ongoing exciting regeneration and investment projects bringing more for those living and working there to enjoy.
Alistair Wells, business expert and owner of Tend Legal, said: “Greater Manchester is a thriving hub for businesses, thanks to its strategic location, diverse economy and skilled workforce.
“The city boasts excellent transport links and a diverse economy, with strengths in digital industries, advanced manufacturing, life sciences and financial services. Manchester is also home to leading research institutions and universities which are ideal for providing a skilled workforce.
“Greater Manchester’s lower cost of living compared to London, along with its vibrant cultural scene and high quality of life, makes it an extremely attractive destination for both professionals and businesses.
“The region also has an admirable commitment to sustainability and urban development, which are playing an enormous role in driving urban growth.”
The most exciting cities
Also in the North West of the country, Liverpool scored noticeably highly in Tend Legal’s research. The city, which has seen vast amounts of regeneration over the past couple of decades, saw the inception of 16,785 new businesses between 2017 and 2022, with 13,545 business deaths, putting it in sixth position overall.
Liverpool continues to attract high levels of investment, with the most prominent at the moment around the Liverpool Waters and waterfront area, generating interest from new businesses and new city-dwellers alike.
Birmingham is the other top business destination outside London, appearing in seventh position on the list with 42,400 new businesses being opened between 2017 and 2022, with 39,220 business deaths.
The upcoming arrival of HS2 to the city, providing even faster connections between Birmingham, London and the rest of the world, is expected to continue to underpin new business growth, as well as interest from investors in the city, in the years to come.
Below is the full top 10 list of areas in the UK with the highest number of business births in comparison to the number of business deaths:
- Camden: 31,940 business births in comparison to 22,970 business deaths
- Hackney: 26,175 business births in comparison to 18,040 business deaths
- Manchester: 28,045 business births in comparison to 20,835 business deaths
- Islington: 22,945 business births in comparison to 17,085 business deaths
- Barnet: 23,880 business births in comparison to 19,095 business deaths
- Liverpool: 16,785 business births in comparison to 13,545 business deaths
- Birmingham: 42,400 business births in comparison to 39,220 business deaths
- Newham: 17,920 business births in comparison to 14,765 business deaths
- Brent: 16,055 business births in comparison to 13,205 business deaths
- Enfield: 14,615 business births in comparison to 11,810 business deaths
The 10 areas of the UK with the lowest number of business births in comparison to the number of business deaths:
- Wiltshire: 13,140 business births in comparison to 16,715 business deaths
- Central Bedfordshire: 9,900 business births in comparison to 12,900 business deaths
- Warrington: 6,375 business births in comparison to 7,970 business deaths
- Bolsover: 1,480 business births in comparison to 2,985 business deaths
- Luton: 9,030 business births in comparison to 10,225 business deaths
- Aberdeenshire: 5,860 business births in comparison to 7,010 business deaths
- Bromsgrove: 13,815 business births in comparison to 14,930 business deaths
- City of London: 18,565 business births in comparison to 19,465 business deaths
- Aberdeen City: 5,790 business births in comparison to 6,570 business deaths
- St Albans: 6,620 business births in comparison to 7,210 business deaths
If you’re interested in acquiring a lucrative property investment opportunity in Manchester, Birmingham, Liverpool or other top-performing UK locations, get in touch with BuyAssociation today.
