Small rural firms in English regions: analysis and key findings from the UK Longitudinal Small Business Survey, 2015

Jeremy Phillipson, Matthew Gorton, Sara Maioli, Pattanapong Tiwasing, Robert Newbery, Roger Turner

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England’s rural firms have similar levels of turnover to their urban counterparts, though they are more likely to report a profit. This finding emerges from our rural-urban analysis of 13,403 small firms in England, including 3,555 rural firms, interviewed for the UK Small Business Survey in 2015. It cannot be explained or attributed to oft-rehearsed differences between rural and urban economies, as the analysis controls for differences in sectors, size, age and other business characteristics of rural and urban areas.

Although rural and urban firms share many plans and expectations for future growth, rural firms are significantly stronger exporters of goods and services, are more likely to have introduced new or improved goods in their businesses, and are more able to secure external funds, especially for capital investments in machinery and buildings, than businesses in urban England.

Nevertheless, there is also clear evidence of Untapped rural potential (for example, more rural firms have goods or services suitable for exporting than which currently export), Weaknesses (for example, rural firms are less likely to expect to grow their workforce) and Obstacles to business success, particularly Regulations or red tape, Staff recruitment and skills, and Taxes, rates and National Insurance (NI) that concern significantly more rural than urban firms.

The analysis also maps marked variations in these and other outcomes, activities and plans across England and its regions. So, to achieve spatially-balanced and inclusive economic growth, we encourage central and local government agencies, Local Enterprise Partnerships and business support and representative organisations to examine this evidence, embed rural business’ strengths and
aspirations, and address weaknesses, in economic strategies, plans and support mechanisms.
Original languageEnglish
PublisherNewcastle University
Number of pages48
Publication statusPrint publication - Sept 2017
Externally publishedYes


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