By Aaron Barbour
Hats off to Prowess - the network of organisations and individuals supporting the growth of women’s business ownership- for working so hard to influence the latest Enterprise Strategy from the Department for Business, Enterprise and Regulatory Reform, which was launched quietly on Budget Day 2008.
We fed into this strategy at a Prowess organised consultation day on bonfire night 2007, after which followed a party at the House of Commons to celebrate Prowess’ fifth birthday. One of the things I took away from the event was the overriding importance and value of a local approach to enterprise and business: 95% of the UK’s small and medium size enterprises (SME’s) operate at a very local level. A local enterprise needs locally tailored support to help their growth and development.
The biggest surprise for me in this strategy was the omission of the informal economy. The importance of informal paid work to the success of the UK’s economy is increasingly being recognised. National Account figures estimate that about 1.5% of GDP is generated in the informal economy (ONS 2001). The EU estimates around 7-16% of GDP, and others argue that undeclared income represents around 12.3% of the UK’s GDP, approximately £120 billion (Schneider, 2000, Schneider, 2006). So why the informal economy does not occupy a central plank of this strategy staggers me.
Our latest report ‘Self-employed and micro-entrepreneurs: Informal trading and the journey towards formalisation’, examines the rationale for self-employed traders and their attitudes towards formalisation. If government wants to hit its PSA business start up, growth and development targets, it is vital that it seeks to acknowledge, understand and address the informal aspects of these businesses.
Read the press release or full report .
This report is a companion to our 2004 report ‘Cheats or Contributors’.
