The Confederation of British Industry (CBI) has called on the Government to provide more support to the UK’s ‘forgotten army’ of medium-sized businesses.
In a new report, the business group urges ministers to improve firms’ access to finance, adding that many medium-sized enterprises are ‘under the radar’ of policymakers.
The CBI said firms with a turnover between £10m and £100m represented less than 1% of UK businesses but generated 22% of revenues and 16% of all jobs.
“Medium-sized businesses are truly a forgotten army, and now is the time to unlock their potential,” commented CBI director general, John Cridland.
“We should be championing, nurturing and encouraging our mid-sized firms so that more of them grow and create jobs. For too long these companies, which could inject tens of billions of pounds into our economy, have fallen under the radar of policymakers”.
The report also suggests that the UK should replicate the German model of the ‘Mittelstand’, where specific support is given to medium-sized businesses.
“I want the UK to have its own version of the German ‘Mittelstand’ – a backbone of medium-sized firms which export, innovate and generate growth,” said Cridland. “These future champions would help the UK weather unexpected economic shocks, and act as a new engine for growth.”
He continued, “To achieve extra growth, medium-sized firms must have access to new kinds of finance. This means opening UK bond markets to medium-sized businesses, encouraging use of venture capital, and making it easier for large companies to invest in medium ones, possibly in their supply chains.”
Responding to the report, a Department for Business spokesperson said, “We welcome the CBI’s focus on the UK’s mid-sized companies […] The Government is already focused on this group as part of the growth review, and we will be setting out our proposals alongside the autumn statement in November.”