Small businesses boosted growth by 50%, report shows
High growth small businesses contributed to the growth of the economy in Northern Ireland by more than 50% in 2014, according to a new report.
The Octopus High Growth Small Business Report 2015 revealed that while Northern Ireland has the fewest number of high growth small businesses (HGSBs) in the UK- just 400 - employing one in 61 people, they were responsible for a significant 56% of gross value-added growth in the province last year.
Gross value added (GVA) is a measure of economic output used to show the value of goods and services produced by different parts of the economy.
GVA gives the value of goods and services produced after taking away the value of everything used in producing them.
Growth in Northern Ireland was just under 1% in 2014.
The report, commissioned by Octopus Investments and produced by the Centre for Economics and Business Research (Cebr) defines HGSBs as those with more than 20% annual average growth in turnover over three years and a turnover of between £1m and £20m.
The report shows that Northern Ireland is the UK region most reliant on strong performing smaller companies for its economic growth and makes the case for increasing the number of HGSBs by 25% in the next five years.
A 25% increase in the number of HGSBs in Northern Ireland in 2014 would have generated 3,348 jobs and £122m additional economic growth (measured in terms of GVA) - an increase of 42%.
In Northern Ireland, 13,000 people were employed by a high growth small business last year.
DUP MP Ian Paisley said the "importance" of high growth firms "cannot be understated".
"Despite making up less than 1% of UK business, they generate an annual turnover of £1.7bn," he said.
"The report suggests that a 25% increase in HGSBs could provide up to 3,500 jobs, a very significant number that should not be overlooked by our Executive.
"I would call on Stormont to assess what else the devolved government can do to encourage more HGSBs to choose Northern Ireland as their base, in the interests of regional growth, reducing our deficit and increasing the number of people in full-time employment."
Simon Rogerson, chief executive of Octopus, said: "High growth small businesses can be found in every region of the UK and across every sector, but are all too easily lost within the broader SME universe.
"These are the companies that could make a real difference to people's lives in Northern Ireland, through their innovation and tremendous contribution to the local economy.
"There is a real need for more of these extraordinary businesses in order to bring prosperity and growth to the region."
The report provides an insight into the value of the UK's fastest growing smaller companies.