Local Economic Impact 2005/06
Job creation and business formation within Birmingham
Companies
No of Limited Companies created in 2005/6 (Companies House Figs)= 385
Sole Traders started up & evidenced = 400
Verified Companies formed = 785
Jobs
New jobs total for Ltd Companies only = 850
A new Ltd company produces 2.6 – 2.9 jobs in local economy (SBS fig) = 1039
Assuming 1 job produced for each sole trder plus owner = 800
Total Jobs created = £28,335,000
Or minimum wage level at £10,000 = £18,890.000
800 jobs created via 400 sole traders at (£10,000) (SBS fig) = £8,000,000
TOTAL jobs income generated ranges from £26.89m to £51.44m
depending on what income assumption is made.
Company Turnover
Turnover income generated through new companies = £19,250,000
Assumes 51% of average turnover in Birmingham from SME’s with average new
limited company generating £50,000 turnover in first year. (Treasury Figs) (High Growth do £200,000 average)
Sole traders start-ups are assumed to do £15,000 turnover per annum = £6,000,000
Combined Turnover Total = £25,250,000
Economic Value
Taking the lowest assumptions for turnover/wages/jobs in Birmingham,
BI start up services generated for the local economy a total of £52.14m
and for upper level assumption would be £76.69m
These figures are verifiable company formation counts using national calculations (SBS, ONS, Treasury model.)
Until new limited companies and sole traders are two years old we have no accounts to check their true value/workforce numbers, however taking the minimum figures of a wage at £10,000 and counting the lowest average turnover rate, Business Insight generated into the local economy, a minimum total of £52.14m, for a cost of £704,225 (overheads/salaries/resources).
A Return of £74 for every £1 invested in Business Insight by BCC.