UK200Group members comment on the role of mid-sized companies in stimulating the economy

Members of the UK200Group of independent accountancy and law firms have today commented on data that suggests mid-sized companies are outstripping big business for jobs growth and, despite forming only one per cent of UK firms, account for a third of private sector turnover. In response, BDO, which has led the research, says the mid-market must be at the heart of government plans to rebalance the economy.

Jonathan Russell, partner at UK200Group member firm ReesRussell, said:

Mid-sized companies are often the ones which fall beneath the radar when looking at the economy, but it is here that many of the big businesses of the future sit. Not bound by shareholder demands, and often with leaner management, they are more nimble and able to react quickly to changing markets. Many of today’s Top FTSE companies were not there some years ago and many of the old industrial names have dropped out. The biggest danger to these mid-sized successful businesses is the demand of the large companies to stimulate their own often stagnant position with aggressive take over. Many of these successful companies then get mired with the cumbersome management of the acquirer. The success of these companies may well be due to the lack of notice they are given by government rather than otherwise. Successful businesses generally do not need help, just good business direction.

Duncan Montgomery, tax partner at UK200Group member firm Whittingham Riddell, said:

While some of the strategies to help boost mid-tier companies are valid, particularly long-term lending trusts, the report appears to be working on data that is not necessarily comparative. A business that shifts brackets in turnover will influence numbers, but may not be moving in the right direction. That should not cloud the incentive to grow this area, which rightly the report suggests is under invested in by government.